TDS on Sale of Property

Tax deducted liability–Immovable property sale-Sec 194IA-online   payment-form 26QB-traces form 16B

As per sec 194IA of Income Tax  Act, TDS liability is attracted on sale of Immovable Property Rs.50 lk or more and payment by online mode consequently, the relevant seller can download TDS certificate in 16B on Traces site.

When did liability fall under TDS?  (Sec .194IA) OF INCOME TAX ACT, 1961

When the buyer of the immovable property makes payment of Rs. 50 lakh or more to the resident Seller of the Immovable property, than Buyer, has to make payment by deducting the tax at the time of payment or credit, whichever is earlier.  Tax called as TDS is required to be deducted @ 1% of the total sale consideration.

However, TDS needs to be deducted @ 20%, if the deductee( SELLER) does not furnish PAN. Also, whenever   the consideration paid or payable for the transfer of immovable property is less than Rs 50 LAKH then no Tds is required to be deducted 

Nowadays, when a person purchases a house property from any builder, then he gets other benefits also like a club membership fee, Parking charges etc, Now, the question arises, whether we have to consider these additional expenses, at the time of calculating the threshold limit of Rs. 50,00,000 

This has been clarified by the government by making the amendment in section 194IA i.e., From 01.09.2019 onwards, other payments like club membership fees, parking charges, water and electricity charges etc shall also be considered for calculating the limit of Rs. 50,00,000. 

How to pay TDS online on purchase of property above Rs 50 lakh by the Buyer?

TDS PAYMENT can be made through challan cum statement on Form 26QB through NSDL website. Deducted TDS shall be deposited to the Government Account through any of the RBI Authorised bank branches using the NSDL  site and pay through e-Tax payment option. 

Due date:

Deducted TDS  must be paid within 30 days from the end of the month in which TDS was deducted.

Prerequisites(FOREMOST NEED):-

Buyer and  Seller are mandatory to have the PAN to make e-payment of TDS on sale of the property. Although it is free from obtaining the TAN (Tax Deduction Account Number).In other words, Buyer is not required to make this payment.

Online Payment: 

The Payment mode can be used by the Buyer by directly go on this link https/tin-Nsdl

Feature of form 26QB used in making payment:-

Actually while making online Payment, the Income Tax Department has issued the relevant for making a smoothly online payment and the form is FORM 26QB.In this form details like Pan of both the seller and buyer required to be filled along with the details of Immovable property, details of purchase and sale and so on.

Government has made User-Friendly mode for paying tax online, the brief guidelines areas:-

• Firstly go on  TIN NSDL website, that is ( www.tin-nsdl.com ).​
• Then go on “Online form  (Form 26QB) for payment of TDS.
• Fill the completed form as applicable.

(The following documents buyer must have handy while filing form 26QB)namely,

1. PAN of the seller & buyer
2. Communication details of seller & buyer
3. Property details
4. Amount paid/credited & tax deposit details

• Thereafter payment can be made through various internet banking facility of various banks. For a list of         authorized banks, please refer https://onlineservices.tin.egov-nsdl.com/etaxnew/Authorizedbanks.html
• The final step is to generate the challan counterfoil and then now E-payment can be made. This counterfoil is proof of payment​ being made.

Responsibility of the Buyer:-

As buyer need to register under Traces portal because Buyer needs to issue TDS certificate that is form 16B to the Seller of Immovable property.

Helping Sites:

If any of the party either Buyer or the Seller face problem then they can contact the Government site called as:-

TIN Call Center at 020-27218080 or email at tininfo@nsdl.co.in