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TDS return Form27A

TDS 479 views 1 replies

While filing return Form 27Q data to be filled for the rate of deduction is 12.5% or effective rate 13% with cess.

TDS for immovable property purchased from NRI less than 50Lakhs.

Replies (1)

For TDS on immovable property purchased from an NRI, the rate of deduction is indeed 20%.

However, since the property value is less than ₹50 lakhs, the rate is reduced to 10% (as per Section 195 of the Income Tax Act).

 But, you've mentioned two rates: 1. _12.5%_: This might be due to the fact that, prior to FY 2018-19, the TDS rate for property purchases from NRIs was 20%, but it was reduced to 10% for properties valued below ₹50 lakhs.

However, for properties valued above ₹50 lakhs, the TDS rate was 20%, which, with cess, became 20% + 3% (cess) = 20.6%, and later 20.6% was rounded off to 20.8% (5% of 20.6%) and then it was rounded off to 12.5% + 12% (cess) = 24% but 12.5% is the TDS rate. 2. _13% (effective rate with cess)_:

 This is incorrect, as the cess is not applicable to the TDS rate in this case.

For Form 27Q, you should fill in the rate of deduction as 20% or 10% (as applicable), without considering the cess.


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