Tax Deduction at Source (TDS) on transfer of immovable properties other than agricultural land for consideration exceeding Rs.50 Lakh
Finance Act, 2013 brought a new section 194-IA under TDS provisions to levy tax at the rate of 1% on the transfer of an immovable property other than Agricultural Land by any Indian Resident where the sale consideration exceeds Rs.50 lakhs. This amendment is effective from 1st June, 2013. So, now if you sale your land or house then you are going to get 1% less then what you had actually received if the transfer had taken place before 1st June, 2013.
Further more if the seller does not possess PAN card then tax shall be deducted @ 20% instead of prescribed 1% as , therefore PAN card gained a vital importance.
The provision will also apply even if the property is financed through a bank loan. Buyer will have to make sure either he himself or the bank deducts tax before disbursing the loan to the seller either in installments or lump-sump amount. The provision will evenly apply in cases where buyer bought an under-construction property prior to the provision coming into effect but has to make the balance payment on or after 1st June,2013.
The tax deducted is to be paid electronically on the Income-tax Department’s website by filling a form online by providing the following details:
- Permanent Account No. (PAN) of Transferee (Payer/Buyer) and Transferor (Payee/Seller)
- Category of PAN of Transferee and of Transferor
- Full Name and Address of the Transferee and Transferor
- Detailed Address of the Property Transferred
- Complete Details of amount paid/Credited
- Details of Tax Deposit
The new form is available on TIN-NSDL and field with * (asterisk) sign is mandatory to be filled.
Click on the image below to open the form
In case a person is not able to pay tax online, he has to fill the form before taking out the printout of the duly filled form and make payment on any authorized branch. The buyer can generate the TDS certificate from I-T department’s website and provide it to the seller. The seller would also be able to see the TDS credit in 26AS statement.