TDS ON THE SALE OF PROPERTY EXPLAINED :

Written By Karan Kapoor

Tax deductible at source or TDS is a concept which was introduced to prevent tax evasion and collect tax from every source of income .

Section 194 A specifies that from 1 st June 2013 , when a buyer buys immovable property costing more than 50 lakh rupees , he has to deduct tax at source when he pays the seller .

  • The tax deductible at source is 1 % of the sale consideration value of the property .

  • The consideration for immovable property shall include club membership charges , car parking charges , electricty fee , water facility fees , maintenance fees or any other charges of similar nature .

  • The TDS is not applicable in case the sale consideration amount is less than 50 lakhs .

  • There is no need for TAN ( Tax deduction account number) for making payment for TDS on immovable property . PAN card will suffice .

  • Form 26 QB is used for making payment of TDS on immovable property .

  • The buyer after depositing the TDS to the government furnishes the TDS certificate in form 16 B to the seller .

Karan Kapoor
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