Query on 1% tds for property

TDS 237 views 4 replies

Agnit Dasgupta

4 Points Joined May 2016

Hi,

I have a query on property of property which is in the final stages of construction and possession has not been given by builder yet ( un-registered property). The investor(original allotee) is selling the property and the builder would transfer the allotment letter from his name to the new allotee.. This property is worth more than 50Lakhs. The investor has already paid 1% TDS on the original property value on behalf of the builder. Now he is selling the property at a higher price ( almost 70% more ). Do the buyer/new allotee need to pay 1% TDS on this property for the allotment transfer from the investor to his name? Should the 1% TDS be paid on for the delta/profit of the investor or the full transfer consideration.

Replies (4)

Jayashree

Software Engineer

82 Points Joined February 2014

normally investor won't go for registration of property only to avoid govt. taxes like stamp duty, service tax, VAT etc. TDS too is part of govt. taxes and applicable to only registered properties i guess.

Why did inverstor paid 1% TDS? Actually he was not required to do so

Experts please correct if I am wrong

kailash Joshi

Project Co-ordinator

45 Points Joined July 2009

Dear Sir, if you go through the provision, the charging point attracting TDS is date of Payment for property Value > 50 Lakhs, whereas the registration is point whereby the IT department gets information to track the transaction fulfiling the above criteria. However although I understand that if investor do not register and sale their property before registration, the same will not form part of AIR of Sub-Registrar, however in such case investor will be taking risk.

Udgam Koomar

Tax Technologist

1949 Points Joined August 2011

its a matter of taking risk, if transaction is tracked, so better to pay. Every subsiquent transfer of ownership where money changes hand, 1% needs to be paid.