TDS on redevelopment of societies: Generally there are exchange of services in the redevelopment transactions with the societies. Societies are transfer the FSI with the development rights to the developer and developer give them a existing area with some extra area free of cost, corpus, betterment charges, alternate accommodation, may be some maintenance charges for few years after possession etc.
in the above transaction, there are lot of FAQ’s and confusions regarding TDS u/s 194IA and 194IC. Lets start one by one:
SECTION 194IA
Q 1 Whether section 194IA applicable ?
Ans. Yes
Q.2 On which amount TDS should be deducted ?
Ans. On agreement value i.e. stamp duty value minus monetary consideration
Q.3 On which name it should be deposited ?
Ans. TDS should be deposited in the PAN of each member in the proportion of apportionment of share in the land as mention in the apartment deed or conveyance deed. if this is not available then in the proportion of their existing carpet areas.
Q.4 what about NRI members?
Ans. In case of NRI members, TDS should be deducted at rate applicable to NRI u/s 195. In that case section 194IA is not applicable.
Q.5 What about 2 or more names are there for one unit?
Ans. TDS should be deducted for each of the co-owner in their proportional share in the said unit.
Q.6 when it should be deposited?
Ans. on or before 30th day of the next month in which agreement is executed
SECTION 194IC
Q.1 Whether section 194IC applicable ?
Ans. Yes, if there is monetary consideration is involved like corpus, alternate accommodation, betterment charges etc.
Q.2 On which amount TDS should be deducted ?
Ans. On monetary consideration like corpus, alternate accommodation, betterment charges etc.
Q.3 On which name it should be deposited ?
Ans. TDS should be deposited in the PAN of each member in the proportion of apportionment of share in the land as mention in the apartment deed or conveyance deed. if this is not available then in the proportion of their existing carpet areas.
Q.4 what about NRI members?
Ans. In case of NRI members, TDS should be deducted at rate applicable to NRI u/s 195. In that case section 194IC is not applicable.
Q.5 What about 2 or more names are there for one unit?
Ans. TDS should be deducted for each of the co-owner in their proportional share in the said unit.
Q.6 when it should be deposited?
Ans. on or before 7th day of the next month in which agreement is executed
Author Bio
We are joint owners of residential house in a Society, which has gone for redevelopment. But the developer has paid consideration in single name when the share certificate and Sale Agreement is in joint names. TCS also issued in single PAN.
Due to this i am being compelled to pay more Taxes, since iam drawing Pension income.
Is is possible to divide this payment received among two joint owners.