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TDS on Purchase of immovable property

Posted @ June 11, 2013, 8:38 pm under (GST & TDS Returns)

TDS provision on purchase of property over Rs 50 lakh
The Finance Act 2013 had provided that purchaser of an immovable property (other than agricultural land) worth over Rs 50 lakh is required to pay withholding tax at the rate of 1% from the consideration payable to a resident transferor. The rate at which tax is to be cut is 1%, but it would go up to as high as 20% if the seller does not disclose his permanent account number. The provision will apply even when the property has been financed through a bank loan.
The purchaser besides making the payment will also have to obtain a challan for the payment and issue Form 16B to the seller.
Mode of TDS payment
The CBDT has issued Form 26QB or “TDS on sale of property” form, an online form for making TDS payments on property transactions. The tax deducted is to be paid electronically on the Income-tax Department's website by filling a form online. If a person does not have the facility to pay tax online, he can take the printout of the duly filled form and make payment on any authorised branch. The income tax authorities have done away with the mandatory requirement of Tax Deduction and Account number for buyers. The buyer will be able to 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 also.
To make the payment fill the following details: Permanent Account Number of the buyer and the seller; complete address of the buyer as well as the seller; address of the eligible immovable property; date of sale agreement and the value of the property that is for consideration.
Once you fill in all the details, the next step will be to make the payment. You can either pay it immediately or on a subsequent date. Once you choose your option, the e-tax payment will direct you to the net banking site of your bank. In case you wish to opt for e-tax payment at a later date, an acknowledgement number will be generated and the same has to be retained by you and presented to any of the authorized banks for further payment. 
Documents that should be given to the seller
The purchaser will be responsible to give the certificate of deduction of tax at source in Form 16B to the seller within 15 days from the due date of submission of the challan. 

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