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For NRI Property Seller (Separately for Each Sellers or Joint Sellers)
Phase I Documents
Following if applicable
Income tax portal login (If not available we can create new registration or reset password)
For Buyers (Separately for Each buyer of Joint buyers)
Best Team of CA/CS to take care Lower TDS Work.
Pan Jurisdiction TRFR
NRI Property Sale Compliance
NRI Property Purchase Compliance
Buyer TAN Application
NRI Property Sale (end to end compliance)
* For Joint Owners there will be Separate Application for each Owner.
* Fees can be shared equally between Buyer and Seller.
* 99% cases the Application will be approved however if Application is reselected due to Lack of Documents. The Fees will be either adjusted towards other Compliance or refunded proportionally to the ratio of work done.
Our Service will include
– Computation of Lower TDS rate or NIL TDS
– Online Form 13 Application and follow up with IT Dept
– Temporary Tan Application and Surrender post Certificate issue
– Filing of Required documents and handling query
– Issuance of Lower TDS/NIL TDS Certificate and online verification
If a Non Resident Indian (NRI) and A Citizen of Indian Origin (CIO) sells their property located in India after retaining it at least for three years, then they has to pay long-term capital gain tax at 22.88%* U/s 195 of Income Tax Act 1961 on the capital gain or in simple term on profit made on the property. However, there are deductions available for investment in property or Bonds. However, as per Section 197, every buyer who purchases the property from such NRI or CIO need to deduct a TDS @ 22.88% on gross sales proceed. In such a situation first paying TDS @ 22.88% and then claiming the refund after filing an IT Return, which may take months if not years, is definitely not a wise decision.
Instead, NRI sellers can apply for a lower or No TDS Deduction Certificate by applying form 13 online from Income tax department in case their actual tax rate for income earned is lower than 22.88%, This will saves them from hassles as well as avoid locking of 22.88% of sales proceeds of Property for months which can be avoided.
The best idea to apply for Low or NIL TDS certificate U/s 197 of Income Tax Act as soon as you find a prospective buyer and properly sale value is fixed.
Apart from that here is the twist An NRI can apply for a lower tax deduction. i.e. for deducing his TDS only on capital gains. The TDS (U/s 195) will be calculated only on capital gain rather than on complete sale value, which in fact can be 1% or 2 % and in some case even No TDS may be required if there is no actual gain as per calculations.
Bonus, you can save this TDS as well as by reinvesting re-invest the capital gain in another property within two years or investing in tax-free bonds (within six months). And they need to apply for a lower TDS certificate under section 195 of income tax. He needs to apply to ask a CA to file for 15CB &15 CB and can remit the money to his country or can keep this money in his NRO account, with a maximum limit of $1 million.
We at AKT associate can help you in the end to end compliance, to make this daunting process to an easy smooth well-coordinated effort. We have a team of best CA/CS to advice you on your financial/taxation matters .any services CA letter, tax calculation, Tax benefits, and tax planning, Moreover, you can do all this process online from anywhere in the world. Well said, ” A stitch in time, saves nine”. You can count on our Expert team In India to carry out your Lower/ No TDS assignment with ease so that you can focus on what matters more to you.
How to define a residential status for NRI?
*If an Indian citizen is spending at least 182 days out of India.
*The person is in India for 2 months in the previous year and has lived in India for entire one year in last four year preceding to Previous year
His residential status can be said as NRI
For CIO (Citizen of Indian origin) & Erstwhile PIO (Person of Indian Origin )only 1st condition is applicable.
Lower TDS Application is processed Online or Offline?
Currently the process is upgraded to Online Application by filing form 13 and submitting an attachment, However, post upload physical documents also need to be deposited duly signed. Still, we need to follow up with jurisdictional Assessing Officer (Income Tax Officer) a multiple time and also need to submit supporting and information for queries raised by him. With our network of associates all over India, we are well coordinated with every IT office in India.
What is rate of TDS Under section 195 on sale of property for NRI?
For an Indian NRI TDS rate U/s 195 is 22.88% i.e. 20% TDS plus 10% Surcharge & 4% Education Cess, of Sale or agreement value. While 1% TDS rate is only applicable for resident property sellers and not in case seller is NRI or CIO card holder. This is rate is same as Capital gain tax rate for NRI tax payers.
What if I declare myself Resident how IT dept. will come to know?
Never try to do this, although we have heard many NRI doing this, and proudly claiming that they got complete payment without an issue. However, considering that the IT can easily get you taxes residency status using you bank details or Passport visa details. The follow up consequences will be terrible, you will not only liable to pay tax at a higher rate but also get penalties along with imprisonment for mis-declaration. Apart from you the buyer will also be in trouble and can face similar consequences. So never take a short cut instead take proper procedure and obtain NIL/Lower TDS deduction certificates.
What is Long term Capital gain tax on the sale of NRI Property?
When Property is held for a period more than 24 months then profit arrived on such properties are called long-term capital gain. While if the property is sold before 24 months it is called short-term capital gain and tax paid on that is called Short term capital gain tax which is currently 34.2% for NRI person without any indexation.
Do an NRI need to be present for lower deduction certificate?
Not exactly, He can authorize someone on his behalf and get it done from his country of current residence. You can authorize AKT Associates to take care of end-to-end TDS proceedings.
Whose responsibility to take lower TDS?
It is seller responsibility to take lower TDS/ NIL TDS certificate and submit to the buyer.
Whose responsibility to deduct and pay TDS?
It is the buyers’ responsibility to deduct and deposit TDS in Property.
What is NIL or Zero TDS Certificate or No TDS deduction certificate?
When Income tax department stating No TDS is required to be deducted issues a TDS certificate, then it is called NIL TDS or Zero TDS Certificate or Non TDS deduction certificate. In such situation seller of the property gets complete sell to proceed without any deduction, Not even 1% Deduction. This can happen on the basis of Capital gain calculation which is prepared by a CA or Expert in Capital gain matters
What is TDS Exemption certificate Under section197?
It is another name of NIL or Zero or No tds certificate issued to NRI Property seller.
How to get TDS Exemption certificate for NRI Sell of Property?
To get NIL or No TDS Certificate, a calculation need to be submitted along other documents to satisfy Assessing officer that there is no Capital gain is arising from the given property sale.
What is Lower TDS application is rejected?
In that case, TDS will be required to paid however the NRI person can claim a refund by filing IT Return. In such a situation, we will assist you in Filing the return and also liaison with IT Department for timely refund issue directly to your NRI Accounts. Fees can be charged based on work scope.
We are handling more than 1500+ successful clients and providing them with services which covers Legal, Technical, Taxation and other business compliance part. That all says a lot on our ways of working and our expertise in the area.
At AKT associates we have been our client’s obvious choice since more than 20 years. For serving you with the best results we use our experience of decades which has exposed us with deep understand.
With a strong team which comprises of experts with qualification like CA, CS, MBA & LLB and they will all available with the wholesome result, with dedicated customer service team and support staff. We are always there to execute your work efficiently.
We touch the top position not just because we are the best in what we do but also because we know the value of your time and money. We know the value of your time so all the work by AKT Associates is performed on time and at around 70% less cost in comparison to all the other leading firms of the market that too without compromising on the quality aspect.
The services of the firm are performed and delivered by using the cutting edge technology which makes the AKT Associates always available & deliver services right in your email. So it doesn’t matter where you are because we are always at your finger tips.