Section 194-IA TDS on sale of property
When you sell a property in India, you may be liable to pay TDS (Tax Deducted at Source) on the sale proceeds. The applicable TDS rate for the sale of property is 1% of the sale consideration for transactions where the sale value exceeds Rs. 50 lakhs.
The buyer of the property is responsible for deducting TDS and depositing it with the Income Tax Department within a specified time frame. The TDS deducted can be claimed as a credit against the seller’s tax liability at the time of filing their income tax return.
If the seller is a resident individual, the TDS rate may be lower or exempted under certain conditions such as when the sale consideration is below a certain threshold, or when the seller provides a declaration in Form 15G/15H stating that their total income is below the taxable limit.
It is important to ensure that TDS is correctly deducted and deposited by the buyer to avoid any penalty or interest charges.
Process of Filing Form 26QB for TDS on sale of property.
Form 26QB is a form used for the payment of TDS (Tax Deducted at Source) on the sale of property in India. It is a challan-cum-statement form that needs to be submitted by the buyer of the property to the Income Tax Department.
Here are the steps to fill Form 26QB for TDS on sale of property:
1. Login to Income Tax website- click on E-file – E-pay tax- New payment and select the Form 26QB option under “TDS on Sale of Property”.
2. Fill in the details of the buyer and seller, such as their names, addresses, and PAN numbers.
3. Enter the details of the property, such as the property type, sale consideration, and the date of agreement.
4. Calculate the TDS amount using the applicable rate (1% of the sale consideration if the property value exceeds Rs. 50 lakhs) and enter it in the form.
5. Select the bank through which you will make the payment, and enter the payment details such as the bank name, branch name, and the date of payment.
6. After completing the form, click on the “Proceed” button to generate the challan.
7. Make the payment through the selected bank and obtain the acknowledgement receipt.
8. Finally, submit the Form 26QB along with the acknowledgement receipt to the concerned TDS Assessing Officer.
It is important to ensure that the Form 26QB is filled accurately and submitted within the specified time frame to avoid any penalty or interest charges.
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The author is a GST and Income Tax Practisioner and can be contacted at 9024915488.
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