Refund of 1% tds on sale of property

Dear,

Buyer is correct. it is immaterial whether you incurred loss or profit. It is payment received or receivable to determeine the applicability of TDS u/s 194 IA.

You can cliam refund for the same if your net income is below applicable limit.

please file your return of Income within due date and claim your refund after adjusting the tax due if any, after getting  form 16B from the deductor u/s 194IA of the Incometax Act.

SELVARAJ R

TAX ADVOCATE

Thanks you all for the answers.

For a theoretical closure on this question,  say a property is sold in March 2015 and the Long Term Gain is Rs 10 lakh. The total sell amount is Rs 100 lakh.

So a TDS is deducted of Rs 1 lakh.

To offset the Capital Gains Tax, one can invest the gains in a 54EC bond within 6 months.

However, the TDS is done is FY2014-15, and the 54EC bond is purchased in FY2015-16.

In such a case how does one claim a refund of the Rs 1 lakh TDS in FY 2014-15 ?

Dear Friend,

If you have really urgency for the sale proceeds and thus do not want to pay TDS, then you may apply to the AO u/s 197 of IT Act, whereby you will be issue a non deduction/lower deduction certificate of tax by the AO in eligbile cases.

But as you know the structure of our Govt. departments, you may undergo difficulties in the same. Moreover the registrar may defer from registering the sale deed unless the TDS challan is submitted, even though the certificate of non-deduction is produced even though you are lawfully eligible for the same. This is also an anomaly of our govt. department structure.

Hence I suggest that you opt for the 197 route only in case of urgency.

To answer your second question, 

Yes you can claim the refund of 1 lakhs in the F.Y 2014-15 itself. It does not matter whether you invested u/s 54EC in the next year.

I am a salaried individual. I am making no profit or loss on the sale of the property but 1% TDS was deducted by the buyer and I am looking to get the amount refunded.  Should I be using ITR 1 or ITR 2 to claim the refund.

Thanks

ITR 1 can not be used. Use ITR 2

For the Question of "Iam Singho" . U can claim refund of TDS. It has nothing to do with 54 EC.

Sir, I purchased a underconstruction flat from builder at 47 laks without registration and taxes, but for home loan from axis bank i have boosted the amount for 54 laks, for this bank given 54000 amount as cheque in favour of me for tds at 1% to pay. but builder not agreed to deduct the tds amount and he is urging to pay the full amount further he is telling this is your issue. I request you to please clarify me for In case I will pay the tds and issue certificate to builder. when will he get the refund from income tax or will not be possible for any refund.

Hi

Form 26B for payment by Buyer

Form 16B for TDS Certificate by Buyer, Seller has either adjust against LTCG/STCG or go for refund.

Hi,

If you register for 54lakhs, you have to pay tds deducting from his payment and issue a certificate and seller can go for adjustment against tax liablity or go for refund only at the time of filing of his IT Returns.

If you register for 47 lakhs, definitely bank would fund you 80-90% as loan only on the registration value which is Rs.47 lakhs not on 54lakhs. if this is the case, TDS applicability wouldnt be there.

Sale consideration is what the discussion area as per Income tax.

How to claim refund of TDS can be claimed in case of cancellation of deal. ?

Mr.Durai sentence is correct.