Tds on token amount paid to nri while buying property

Dear Sir/Madam,

I have made a sale agreement to NRI (through Power of Attorney) on 13th July 2017. I paid Rs. 100000/- as token amount.  The Sale agreement was valid for 60 days (i.e. till 13th september 2017). Based on above Sale Agreement I applied for Home Loan and Sellar applied for Lower TDS (under section 195/197).

Now my home loan was approved on August 18th, 2017 but Seller got Lower TDS certificate 197(1), with 1% TDS deduction from AO Income-Tax on 25th september 2017. We both agree to finalize the deal as we planned.

Now I need to pay TDS on the agreed total sum (say Rs. 500000/-). My questions are,

1. Since I paid token amount on 13th July, 2017, and lower TDS certificate is only valid from 25 September 2017. How much amount of "TDS on the Token amount"  do I need to pay ? i.e. Should I pay 20.6 % of 100000 = Rs. 20,600 /-  or can I combined all the amount and pay 1% on the total Rs. 500000/- = Rs. 50000/-.

2. Do I need to pay penalty charge as well, if yes how much in both the cases discussed in point -1 above?

Could you please help.

 

 

Replies (2)

*Correction in above query...Total Sum = Rs 50,00,000/- (Rs. Fifty Lacs only)

Token money is first taken by seller on signing Agreementto Sell. Then Tan is applied for. Both are sent to ITO for Tds Certificate. How can Tds on token money be done without Tan. 
If instead of 10% advance (10 lakhs) only two lakh token money is taken, will Tds be required on small token money.
Thanks for reply in anticipation
DC Bhargava

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 07 October 2026
Article Trainee/ CMA Trainee

RMA And Associates LLP

New Delhi

CA Inter

View Details
Company
ARTICLESHIP 23 October 2026
CA Articleship / Article Assistant

M N Rao & Associates LLP

Vijayawada

CA Inter

View Details
Company
12 October 2026
Chartered Accountant - Internal Audit

HKC | Chartered Accountants & Business Advisors

Ludhiana

CA

View Details
Company
ARTICLESHIP 23 October 2026
Articled Trainee

J Y & CO

Hyderabad

CA Inter

View Details
Company
ARTICLESHIP 07 October 2026
Article Assistant

Malhotra Rajesh & Associates

New Delhi

B.Com

View Details
Company
12 October 2026
Finance

I-Genext Consulting Private Limited

New Delhi

CA

View Details
Company
Featured 03 October 2026
Accountant

A P Lodha and Associates

Jalna

B.Com

View Details
Company
30 September 2026
Senior Accountant

Codeboard Technology

Chennai

B.Com

View Details