{"id":18951,"date":"2020-11-04T14:11:22","date_gmt":"2020-11-04T08:41:22","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=18951"},"modified":"2021-11-11T14:24:31","modified_gmt":"2021-11-11T08:54:31","slug":"tds-on-sale-of-property-procedure-and-requirements","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/tds-on-sale-of-property-procedure-and-requirements\/","title":{"rendered":"TDS on Sale of Property: Procedure and Requirements"},"content":{"rendered":"\n<p class=\"has-drop-cap\">From the 1st June year 2013, if in case the buyer buys immovable property (a building or any part of building or land other than agricultural land) whose cost is more than Rs 50 lakhs, then he has to deduct (TDS) tax at source. This particular illustration upon <a href=\"https:\/\/corpbiz.io\/tds-return-filing\"><strong>TDS<\/strong><\/a> on sale of property has been laid down in <strong><em>Section 194-IA of Income Tax Act.<\/em><\/strong><\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/tds-on-sale-of-property-procedure-and-requirements\/#TDS_on_Sale_of_Property_Requirements\" >TDS on Sale of Property Requirements<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/tds-on-sale-of-property-procedure-and-requirements\/#Procedure_for_TDS_on_Sale_of_Property\" >Procedure for TDS on Sale of Property<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/tds-on-sale-of-property-procedure-and-requirements\/#Mandatory_Filing_of_Form_26QB\" >Mandatory Filing of Form 26QB<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/tds-on-sale-of-property-procedure-and-requirements\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"TDS_on_Sale_of_Property_Requirements\"><\/span>TDS on Sale of Property Requirements <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>Here are requirements of section 194IA:<\/em><\/strong><\/p>\n\n\n\n<ul><li>The buyer must deduct TDS <strong><em>at 1% of a total sale\nconsideration<\/em><\/strong>. It has to be noted that a buyer requires deducting TDS,\nnot a seller. The <strong><em>rate is 0.75%<\/em><\/strong> for the transaction carried out from <strong><em>14th\nMay 2020 to 31st March 2021.<\/em><\/strong><\/li><li>TDS is not needed to be deducted in case where\nsale consideration is less than Rs 50 lakhs. If a payment is made by\ninstalments, then TDS has to be deducted as each instalment paid.<\/li><li>The <strong><em>union budget 2019<\/em><\/strong> has proposed the\ndefinition for &#8220;<strong><em>consideration for an immovable property<\/em><\/strong>&#8221;\nto include all the charges of nature of club membership fee, car parking fee,\nmaintenance fee, electricity or water facility fee, advance fee or any other\ncharges of any similar nature, which are incidental to transfer of an immovable\nproperty. It has been applicable for immovable property purchased after 1st\nSeptember 2019.<\/li><li>TDS must be paid on an entire sale amount. For\ninstance, in case a person has bought a house at Rs 55lakh, then he requires paying\nTDS on Rs 55 lakh itself and not only on Rs 5 lakh. It will be applicable also\neven when there is more than one buyer or seller in the transaction.<\/li><li>Post budget 2019 amendment made to section\n194-IA, for example, if on 1st Sept 2019, a person have paid Rs 2 lakh towards\nparking fee, similarly Rs 1 lakh for water facility fee and also Rs 1 lakh for\nelectricity fee, then sale consideration would becomes Rs 59 lakh (55 lakh +2\nlakh+1 lakh+1 lakh), and a person will have to pay TDS on Rs 59 lakh @ 1%.\nTherefore, TDS payable would be Rs 59,000. In case a transaction is carried out\nfrom <strong><em>14th\nMay 2020 to 31st March 2021<\/em><\/strong>, the rate will be of 0.75%.<\/li><li>The buyer of an immovable property need not\nobtain the TAN (Tax Deduction Account Number) for making payment of TDS on\nimmovable property. The payment can be made by using the PAN card itself.<\/li><li>For a purpose of making payment of TDS on an\nimmovable property, a buyer has to obtain the PAN of a seller; else TDS will deduct\nat 20%. The PAN of a buyer is also mandatory for transaction. TDS is deducted\nat a time of making payment (including the instalment payments) or at the time\nof giving credit to seller, whichever is earlier.<\/li><li>The TDS on an immovable property must be paid\nusing Form 26QB within 30 days from the end of month in which the TDS was\ndeducted. After depositing the TDS to government, the buyer is required to\nfurnish TDS certificate in <strong>form 16B<\/strong>\nto seller. It is available around <strong>10-15\ndays<\/strong> after depositing the TDS.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Penalties Applicable for non-filing of Form 26QB<\/h3>\n\n\n\n<table class=\"table table-bordered\"><tbody><tr><td><strong>Interest&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <\/strong>   <\/td><td>\n  <strong>Calculation<\/strong>\n  <strong>&nbsp;<\/strong>\n  <\/td><\/tr><tr><td>\n  <strong>Non-deduction of the TDS<\/strong>\n  <strong>&nbsp;<\/strong>\n  <\/td><td>  1% per   month for a period from the date on which TDS is deductible and collectable to the date on which TDS and TCS is actually deducted.   <strong>&nbsp;<\/strong>   <\/td><\/tr><tr><td>\n  <strong>&nbsp;<\/strong>\n  <strong>Non-remittance of the TDS<\/strong>\n  <strong>&nbsp;<\/strong>\n  <\/td><td>1.5% per   month for a period from the date on which TDS is deducted to the actual date   of payment.   &nbsp;   <\/td><\/tr><\/tbody><\/table>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/documents-required-for-tds-return-filing-online-india\/\">All about Documents Required for TDS Return filing<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Procedure_for_TDS_on_Sale_of_Property\"><\/span>Procedure for TDS on Sale of Property<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The steps to pay the <strong><em>TDS through challan 26QB<\/em><\/strong> and to\nobtain <strong><em>Form 16B (for a seller)<\/em><\/strong> are as below:-<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 1: Payment via Challan 26QB (Online and Offline)<\/h3>\n\n\n\n<ul><li>Click on to Form 26QB and select 0020 if one is\na corporate payer or 0021 if one is a non-corporate payer. Fill in all\nnecessary details. There will be two modes of payment at a bottom of the page-\ne-tax payment immediately (by net banking facility) and e-tax payment on the\nsubsequent date (e-payment of taxes by visiting any of the nearest Bank\nbranches). Choose any of them which you prefer, if online then click on to\nProceed.<\/li><li>On choosing net-banking, one will able to login\nand pay online. After payment is done, the bank will let you print the Challan\n280 with a tick on 800 (i.e. payment of TDS on the sale of property). Take out\nthe print for future reference.<\/li><li>In case you cannot pay online, then an online\nreceipt for the Form 26QB with a unique Acknowledgment Number is generated.\nThis can be valid for 10 days after its generation. You can take it to your\nnearest bank for making an online payment. The bank will proceed with the\npayment and generate your challan.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Step 2: Register in TRACES<\/h3>\n\n\n\n<ul><li>If you are a first-time user, then register first on TRACES as the Taxpayer with the <strong><em>PAN<\/em><\/strong><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Permanent_account_number\"><strong><em>[1]<\/em><\/strong><\/a><\/sup> Card Number and with the registered Challan number.<\/li><li>On registering, you can obtain approved Form 16B (the TDS certificate) and you can issue Form to Seller. Check the Form 26AS after seven days of payment. You can see that the payment is reflected in Part F under the &#8220;Details of Tax Deducted at Source on Sale of Immovable Property under section 194(IA) [For Buyer of Property]. Part F information is not available for claiming ITR (<a href=\"https:\/\/corpbiz.io\/income-tax-return-filing\"><strong>Income tax return<\/strong><\/a>) of the buyer. <\/li><li>It provides you details like TDS certificate number (which TRACES generates), name and PAN of deductee, amount and transaction date, acknowledgement number (which is same as the one on the Form 26QB), date of deposit and the TDS deposited.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Step 3: Download the Form 16B<\/h3>\n\n\n\n<ul><li>After the payment in Form 26AS has been\nreflected, login to TRACES. Go to Download tab and click on to &#8220;Form-16B\n(for buyer)&#8221;.<\/li><li>To finish the process, fill PAN of a seller and\nacknowledgement number details pertaining to the property transaction for which\nthe Form-16B has been requested and click on to &#8220;Proceed&#8221;. Verify all\ndetails once and click on to &#8220;Submit request&#8221;.<\/li><li>After a few hours, the request will be\nprocessed. Click on to Downloads tab and select the Requested Downloads from\nthe drop-down menu<\/li><li>You will be able to see that a status of your\nForm 16B download request is now available. If status says Submitted wait for\nfew hours more before repeating a last step. Download the file. The password to\nopen the file will be Date of Birth of Deductor (format is DDMMYYYY). Your form\nwill be available inside the file. Take the print for future reference.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Mandatory_Filing_of_Form_26QB\"><\/span>Mandatory Filing of Form 26QB<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>&nbsp;<strong><em>Section 194 IA of Income Tax Act,\n1961 read with Rule 30, 31 &amp; 31A<\/em><\/strong> of the Income Tax Rules states\nthat:-<\/p>\n\n\n\n<ul><li>Tax deducted must be deposited to Government Account by e-tax Payment option (Net-banking) or any nearby authorised bank branches. The sum so deducted under <strong>section 194-IA<\/strong> must required to be paid to the credit of Central Government within <strong><em>the period of 7 days<\/em><\/strong> <strong><em>from the end of month<\/em><\/strong> in which the deduction is made.<\/li><li>PAN of seller, as well as of the Purchaser, must be mandatorily furnished in an online <strong><em>form (Form 26QB)<\/em><\/strong> for furnishing information regarding a property transaction. Facility for furnishing an information regarding transaction of sale of an immovable property and payment of TDS thereof is available on the website www.tin-nsdl.com <\/li><li>TDS certificate in the <strong><em>Form 16B<\/em><\/strong> is required to be issued by Buyer of property to Seller, in respect of the taxes deducted and deposited into the Government&#8217;s Account. The Form 16B will be available for download by registering on to website of Centralized Processing Cell (TDS) www.tdscpc.gov.in<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>According to <strong>Finance\nAct of 2013<\/strong>, TDS will be applicable on transfer of immovable property,\nwherein a consideration of the property exceeds or is equal to Rs 50 Lakhs. For\nall transactions with effect from <strong>1st\nJune, 2013, Tax @ 1% <\/strong>has been deducted by purchaser of the property at a\ntime of making payment for sale consideration. <\/p>\n\n\n\n<p>We at <a href=\"https:\/\/corpbiz.io\/\"><strong>Corpbiz<\/strong><\/a> are very much inclined towards taking the responsibility on behalf of our clients. We appreciate and ready to help and also guide regarding the issues related to TDS filing, TDS returns filing and also provides services in respect to Income Tax return filing.&nbsp; <\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/benefits-of-tds-return-filing-in-india\/\">All about Benefits of TDS Return Filing in India<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>From the 1st June year 2013, if in case the buyer buys immovable property (a building or any part of building or land other than agricultural land) whose cost is more than Rs 50 lakhs, then he has to deduct (TDS) tax at source. This particular illustration upon TDS on sale of property has been [&hellip;]<\/p>\n","protected":false},"author":10,"featured_media":18955,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[237],"tags":[1178],"acf":{"service_id":"51"},"authorName":"Soumya Bajpai","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/01\/0.jpg","authorDescription":"Soumya has done LLB (Hons) and has a 2+years experience in writing. Her main interest is in reading judgments, new enactments and amendments taking around in law. She always strives to bring the best to work that she does.","postViews":8726,"readingTime":5,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/18951"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=18951"}],"version-history":[{"count":9,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/18951\/revisions"}],"predecessor-version":[{"id":37791,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/18951\/revisions\/37791"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/18955"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=18951"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=18951"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=18951"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}