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Form 26QB queries for joint property owners

Roger (Freelancer) (34 Points)

30 January 2015  

Wife named A (first name in the property) and husband named B (second name in the property) have bought a joint property costing more than 50 lakhs. The reason they bought this property jointly was to equally claim the Income Tax benefit for interest and principal repayment of the loan raised to buy this property.

 

Towards the first payment of 10 lakhs B paid 9.90 lakhs out of his account after witholding 10,000 towards TDS.

 

While making the TDS payment the below queries arise:-

  1. Whose PAN number should be used as the "PAN of the Transferee" in Form 26QB ? Is it A's (first name in the property) or B's (who has paid the amount of 9.90 lakhs from his account alone).
  2. From whose account should the TDS payment of 10,000 be made ? Is it A's (first name in the property) or B's (from whose account 9.90 has been paid).
  3. The wordings on NSDL TDS site (https://www.tin-nsdl.com/TDS/TDS-FAQ.php) are as follows:- "Oline statement cum challan Form/ Form 26QB is to be filled in by each buyer for unique buyer-seller combination for respective share. E.g. in case of one buyer and two sellers, two forms have to be filled in and for two buyers and two seller, four forms have to be filled in for respective property shares.". The question here is, how is the respective share calculated, recorded or evidenced from an Income tax perspective.

 15 Replies

Shobhit Goel (Chartered Accountant) (101 Points)
Replied 30 January 2015

Hi Roger,

In my view, answer to your query is TDS is required to be deducted on total consideration irrespective of No. of buyers or Sellers & their respective contribution in property. If property value is more than 50 lacs than irrespective of No. of buyers and sellers, TDS will be deducted by buyer/s. All buyers/sellers will file/receive seperate forms/TDS certificates.

Thanks,

Shobhit

CA Pankaj Kr Agrawal (@Helping Hand) (2138 Points)
Replied 30 January 2015

Hi,

 

TDS shall be paid by Co-ownership in their respective ratio irrespective of the fact of payment made by either of co-owner. After Obtaining the ownership or in the middle of contract, co-owner will settle his/her account accordingly. So your answer is.

 

1)  Two Separate payment shall be made by respective co-owner by quoting rexpective PAN in form 26QB. Each Co-Owner shall pay TDS on their Co-ownership ratio. 

 

2) First of all Govt. is only concern with revenue/  payment of TDS by deductor.

it is advisable to pay tax from respective co-owner bank account.

 

 

Thank you 

2 Like

Hemant (Finance Professional) (32 Points)
Replied 24 August 2015

Originally posted by : CA Pankaj Kr Agrawal
Hi,

 

TDS shall be paid by Co-ownership in their respective ratio irrespective of the fact of payment made by either of co-owner. After Obtaining the ownership or in the middle of contract, co-owner will settle his/her account accordingly. So your answer is.

 

1)  Two Separate payment shall be made by respective co-owner by quoting rexpective PAN in form 26QB. Each Co-Owner shall pay TDS on their Co-ownership ratio. 

 

2) First of all Govt. is only concern with revenue/  payment of TDS by deductor.

it is advisable to pay tax from respective co-owner bank account.

 

 

Thank you 

Me and my wife (both salaried) sold a jointly owned flat to another couple. Ownership pattern changed from Husband1+Wife1 => Wife2+Husband2.

As per my understanding, TDS deduction should have happened in four transactions as below

Wife2 => Husband1 PAN (0.25%)

Wife2 => Wife1 PAN (0.25%)

Husband2 => Husband1 PAN (0.25%)

Husband2 => Wife1 PAN (0.25%)

But while deducting the TDS, Wife2 (as adviced by her CA) credited full 1% TDS to Husband1's PAN in a single transaction. I had highlighted this to the buyers. Their response was that TDS transaction should be only between first owners i.e. Wife2 => Husband1 (1% TDS). I checked with a couple of real estate brokers and they supported this theory too and asked me to chill. Govt is only concerned about revenue etc

Now me and my wife are filing our returns have few questions regarding the same.

1. Since full TDS is credited against Husband1's PAN, should he cover 100% LTCG in his returns?

2. Ideally we would like to split LTCG equally. But if we do that, could there be any issues going forward (given that Wife1 does not have TDS credited to her PAN)?

3. I understand that TDS is responsibility of the buyer. So should I just split LTCG 50-50% and let the buyer do the answering, if required? If I split LTCG, could we land in trouble in future?

Thanks in advance.

Hemant

NITIN (Engineer) (38 Points)
Replied 25 March 2016

Dear Sir

I have purchased flat (Cost 60 Lac ) in march 2015 with my wife ass co-owner.from one reputed builder. 

My wife is full time house wife. there is no percentage ownership mentioned in agreement.

I paid  full 1 % TDS (i.e. 60,000 Rs)  from my account ( My own PAN) in april 2015. 

please suggest me do my wife also need to fill form 26QB quoting her PAN. 

 

if yes how it can be done now.

............

nitin

sushant (Mr) (21 Points)
Replied 14 April 2016

https://blog.tdsman.com/2013/11/will-transactions-one-buyerseller-filed-form-26qb-tds-immovable-property/

Above link tells that Online statement cum Challan Form/ Form 26QB is to be filled in by each buyer for unique buyer-seller combination for respective share. E.g. in case of one buyer and two sellers, two forms have to be filled in and for two buyers and two seller, four forms have to be filled in for respective property shares.

if in case only one of the buyer (say if husband and wife are the joint buyers) has already filled the 26 QB with the whole 1% tax amount, what would be the procedure to correct it? Also what about the late fees in this case (as the whole amount is already with government, and it's just the correction)?

Prabha Biswas (7 Points)
Replied 22 April 2016

Dear Sushant,

Did u get any solutions to your question? As even I am facing similar problem of tds and would like to know .Please do share in this post the soltuion u recieve.

Prabha Biswas (7 Points)
Replied 22 April 2016

Nitin, Did u get any solutions to your question? As even I am facing similar problem of tds and would like to know .Please do share in this post the soltuion u recieve.

1 Like

hello3anurag (engineer) (22 Points)
Replied 21 September 2016

Dear Sushant, Did u get any solutions to your question? As even I am facing similar problem of tds and would like to know .Please do share in this post the soltuion u recieve.

 

hello3anurag (engineer) (22 Points)
Replied 21 September 2016

Dear Nitin, Did u get any solutions to your question? I am facing similar problem of tds and would like to know .Please do share in this post the soltuion u recieve. 

VN (Line Manager) (29 Points)
Replied 05 January 2017

I am about to purchase a property and wanted some clarity. Property is being purchased along with my mother. All funding is coming from my Mother's account in leiu of another property that got sold in her name as we would want to save on tax on capital gain. Complete property amount, stamp duty is paid by her. On sale deed my mother and I would be buyers. My name is there more as a joint owner but I will not be paying anything from my account. Payment is being done in lumsum with no home loans from either side . Seller is single individual. My queries :
1) For 1% TDS, should my mother be paying complete amount via form 26qb since she is funding entire purchase? 
2) Do I need to file form 26QB? What I understood from discussion is that TDS is payed based on proportionate ownership. Since I have not contributed anything, I don't have to file 25QB. Is that correct? 
3) while filling form 26QB, with my mother's PAN, do I have to mention more than 1 buyer?

My lawyer and CA said that since my mother is funding the entire amount, she should only file 26qb for entire 1% amount and I need not file it. My name can however be in Sale deed even if I have not contributed anything. Even in 26qb form, I can mention as only single buyer as she is paying entire 1% and funding the entire purchase. Is this correct approach? 

ANIL TALREJA (PROPERITOR) (35 Points)
Replied 01 February 2017

R/S 

IF  SALE VALUE OF PROPERTY IS RS  1 CRORE  AND THERE ARE FOUR JOINT OWNERS (PURCHASER ( 25% )THEN THE AMOUNT OF EACH PERSON COMES TO 25 LAC 

NOW WHETHERTDS TO BE DEDUCTED SINCE VALUE IS LESS THEN 50 LAC

ANIL TALREJA (PROPERITOR) (35 Points)
Replied 01 February 2017

R/S 

IF  SALE VALUE OF PROPERTY IS RS  1 CRORE  AND THERE ARE FOUR JOINT OWNERS (PURCHASER ( 25% )THEN THE AMOUNT OF EACH PERSON COMES TO 25 LAC 

NOW WHETHERTDS TO BE DEDUCTED SINCE VALUE IS LESS THEN 50 LAC

Khushboo (JOB) (58 Points)
Replied 30 May 2017

Seller is one  person but buyer have two person (husband & wife). liablity of pay tds only of one or both.

TDS is deucted on 31 may 2016 & still not paid how to compute penalty, while i fill the form there could not compute automatically penalty, ther show clip of raise demand. please be clarify

 

Prashant Arote (ITS) (22 Points)
Replied 19 January 2018

Any one got solution on concern raised by sushant

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