{"id":24482,"date":"2019-09-11T19:30:12","date_gmt":"2019-09-11T14:00:12","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=24482"},"modified":"2019-09-11T17:03:15","modified_gmt":"2019-09-11T11:33:15","slug":"194-ia-read-about-tds-on-immovable-property","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/194-ia-read-about-tds-on-immovable-property\/","title":{"rendered":"194-IA &#8211; Read About TDS on Immovable Property"},"content":{"rendered":"<p>Section 194-IA is effective from 1<sup>st<\/sup> June 2013 on the sale\/ purchase of immovable <a class=\"glossaryLink\"  aria-describedby=\"tt\"  data-cmtooltip=\"&lt;div class=glossaryItemTitle&gt;Property&lt;\/div&gt;&lt;div class=glossaryItemBody&gt;Property refers to the legal designation of ownership over valuable items or assets held by an individual or a business. This ownership grants the holder certain legal rights to use, consume,(...)&lt;\/div&gt;\"  href=\"https:\/\/enterslice.com\/learning\/terms\/property\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'>property<\/a>. A buyer of immovable property at the time of making payment of contribution has to deduct the TDS (Tax deducted at source) from the amount. This section applies to every transaction of INR 50 Lakhs or more. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>TDS Return Forms<\/strong><\/h2>\n\n\n\n<p>Depending upon the purpose of\ndeduction, the following forms are filed for TDS return:<\/p>\n\n\n\n<ol><li><strong>TDS on salary: Form 24Q<\/strong><\/li><li><strong>TDS in case of a foreign company: Form 27Q<\/strong><\/li><li><strong>TDS for transfer of immovable property: Form 26QB<\/strong><\/li><li><strong>TDS for other cases: Form 26Q<\/strong><\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Applicability of Section 194-IA of TDS on Immovable Property<\/strong><\/h2>\n\n\n\n<p>Section 194-IA applies in the\nfollowing case:<\/p>\n\n\n\n<ul><li>When\nany person purchases an immovable property from the transferor, an amount of\nconsideration is paid for such transfer by the transferee to the transferor. A\nperson who purchases the property is known as transferee and transferor is the\nperson who is selling his immovable property for the amount termed as\nconsideration.&nbsp; The transferee has to\ndeduct the amount of 1% of consideration as an Income tax from such amount at\nthe time of making the payment through cash, bank transfer, cheque, draft or\nany other mode. <\/li><li>This\nsection is applicable if the amount of consideration involved is INR 5000000\n(Rupees Fifty Lakhs) or more.<\/li><li>Union\nbudget of 2019 has introduced the definition of &ldquo;consideration.&rdquo; It\nincludes all forms of other charges such as maintenance fees, electricity fees,\nwater facility fees, advance fees, etc.<\/li><li>This\nsection applies to the transfer of all the immovable property other than\nagricultural land.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Exception for Applicability of Section 194 IA<\/strong><\/h2>\n\n\n\n<p>Section 194-IA does not apply to\nthe following:<\/p>\n\n\n\n<ul><li>In\ncases of compulsory acquisition<\/li><li>When\nthe seller is NRI and TDS is to be deducted based on Capital gains.<\/li><li>For\nconstruction properties, TDS will be deducted on the installments paid before 1<sup>st<\/sup>\nJune 2013. This section was applicable from 1<sup>st<\/sup> June 2013. <\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Exception for Agricultural Land<\/strong><\/h2>\n\n\n\n<p>The land shall not be treated as\nagricultural land for this section &amp; shall be considered as immovable\nproperty if it is situated within the following range of area:<\/p>\n\n\n\n<ul><li>If\nthe population of the municipality is more than 10000 but up to 100000, land\nshould be located within the distance of 2Km from Municipal limit<\/li><li>If\nthe population of the municipality is more than 100000 but up 1000000, land\nshould be located within the distance of 6Km from Municipal limit<\/li><li>If\nthe population exceeds 1000000, land should be located within the distance of 8Km\nfrom the Municipal limit.<\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image\"><a href=\"https:\/\/enterslice.com\/gst-registration\" target=\"_blank\" rel=\"noreferrer noopener\"><img decoding=\"async\" loading=\"lazy\" width=\"730\" height=\"90\" src=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/01\/GST.jpg\" alt=\"GST Registration Online\" class=\"wp-image-23999\" srcset=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/01\/GST.jpg 730w, https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/01\/GST-300x37.jpg 300w\" sizes=\"(max-width: 730px) 100vw, 730px\"\/><\/a><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Key Points for Understanding Section 194-IA<\/strong><\/h2>\n\n\n\n<p>Following are the key points for\nbetter understanding about section 194-IA<\/p>\n\n\n\n<ul><li>TDS\nis paid on the entire sale consideration. For example, a property worth INR 60\nLakhs is sold. And transferee has paid electricity fee of INR 1 Lakhs and\nmaintenance fees of INR 2 Lakhs. The total amount of consideration will be\n60+1+2= INR 63 Lakhs, and TDS is deducted at the rate of 1% of INR 63 Lakhs\nthat is INR 63000.<\/li><li>Buyer\nof the immovable property who deducts the TAN needs not to have Tax deduction\naccount Number, though permanent account number (PAN) is sufficient.<\/li><li>TDS\nis submitted and paid in the form of 26QB. After the tax is deposited with the\nGovernment, the buyer has to give a TDS certificate in form 16B to the seller. This\nhas to be issued within 15 days.<\/li><li>Form\n26QB is to be filed for each buyer-seller separately. For example: if there is\none buyer &amp; 2 sellers, the total amount of 26QB to be filled will be two.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>The Requirement of PAN of the Seller of an Immovable Property<\/strong><\/h2>\n\n\n\n<ul><li>It\nis compulsory for the seller of the property whose receipt of consideration for\nthe transfer is subject to TDS has to furnish his PAN to the transferee<\/li><li>If\nthe PAN is not provided, TDS will be deducted at the rate of 20% of\nconsideration instead of 1% of the consideration.<\/li><li>It\nis deemed that PAN is not furnished in case the PAN provided is invalid or does\nnot belong to the transferor.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>The Due Date for Deducting and Payment of TDS<\/strong><\/h2>\n\n\n\n<ul><li><strong>Payment: <\/strong>TDS on the\nimmovable property has to be paid within 30 days from the end of the month in\nwhich TDS is deducted. For example, TDS is deducted on 06\/09\/2019, TDS becomes\npayable within 31\/10\/2019.<\/li><li><strong>Deduction:<\/strong>\nThe transferee has to deduct the amount of 1% of consideration as an Income tax\nfrom such amount at the time of making the payment through cash, bank transfer,\ncheque, draft or any other mode. The transferee has to deduct the TDS right\nfrom the beginning of the first installment. Transferee doesn&rsquo;t have to wait\nfor the final installment or amount to exceed INR 50 Lakhs for deducting TDS\nfrom installment.<\/li><\/ul>\n\n\n\n<div class=\"read\"><p><b>Also, Read:<\/b> <mark><a href=\"https:\/\/enterslice.com\/learning\/tds-exemption-certificate\/\" target=\"_blank\" rel=\"noopener noreferrer\">TDS Exemption Certificate<\/a><\/mark>.<\/p><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Steps of Payment of TDS through 26QB and Downloading of Form 16B<\/strong><\/h2>\n\n\n\n<p>Following are the complete\nprocedure for payment and filing of 26QB and furnishing of form 16B:<\/p>\n\n\n\n<ul><li>Go to the online website <strong><em>https:\/\/onlineservices.tin.egov-nsdl.com\/etaxnew\/tdsnontds.jsp<\/em><\/strong><sup><a href=\"https:\/\/onlineservices.tin.egov-nsdl.com\/etaxnew\/tdsnontds.jsp\">[1]<\/a><\/sup> and click on the form 26QB.<\/li><li>Once the form is opened first, most corporate payers need to select 0020 and non-company has to select 0021.<\/li><li>Fill the complete details of the form<\/li><li>After completing the form, select the mode of payment. The payment can be made in two ways, online &amp; offline. An amount can be paid online through net banking or offline by visiting any bank branch for payment. <\/li><li>After the payment is completed, registration with TRACES has to be done. In the case of a new user, registration as a new user can be done using PAN number and completing the details.<\/li><li>Once the payment is made it is reflected within seven days in form 26AS of the transferee under the head of details of TDS on Sale of Immovable Property. <\/li><li>Once the registration is completed, and payment is reflected in form 26AS, the TDS payer can download approved form 16B for issuing it to the seller.<\/li><li>16B can be downloaded by login to TRACES &amp; click on the download tab and select Form 16B.<\/li><li>Complete the details and fill the PAN of the seller and click on proceed.<\/li><li>After verification of complete details, click on the option &ldquo;submit a request,&rdquo; and the request will be generated within a few hours.<\/li><li>One can see the status of the form 16B. If it is available, it can be downloaded.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Penalty &amp; Interest on Non-payment and Non-filing of TDS.<\/strong><\/h2>\n\n\n\n<p>Following are the penalty &amp;\ninterest depending upon the case of failure:<\/p>\n\n\n\n<ul><li><strong>No TDS deducted:<\/strong>\nInterest at the rate of 1% per month has to be deducted for the period of TDS\nliable to be deducted to the date it is deducted&nbsp; <\/li><li><strong>TDS deducted but not paid:<\/strong>\nInterest at the rate of 1.5% per month has to be deducted from the date TDS\ndeducted to the date TDS paid.<\/li><li><strong>Late filing of 26QB:<\/strong>\nThe penalty is also payable at the rate of 200 per day for the days of defaults\ncontinued.&nbsp; The maximum amount of penalty\nis subject to the number of TDS to be deducted.<\/li><\/ul>\n\n\n\n<div class=\"read\"><p><b>Also, Read:<\/b> <mark><a href=\"https:\/\/enterslice.com\/learning\/section-73-of-the-income-tax-act-1961%ef%bb%bf\/\" target=\"_blank\" rel=\"noopener noreferrer\">Section 73 of the Income Tax Act, 1961&#65279;<\/a><\/mark>.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Section 194-IA is effective from 1st June 2013 on the sale\/ purchase of immovable property. A buyer of immovable property at the time of making payment of contribution has to deduct the TDS (Tax deducted at source) from the amount. This section applies to every transaction of INR 50 Lakhs or more. TDS Return Forms [&hellip;]<\/p>\n","protected":false},"author":24,"featured_media":24496,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1,2435],"tags":[2743,2742],"acf":{"service_id":"90"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v14.6.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>194-IA - Read About TDS on Immovable Property - Enterslice<\/title>\n<meta name=\"description\" content=\"The section 194-IA of the income tax act reads about the implications and pentalty of TDS on sale or purchase of Immovable Property\" \/>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterslice.com\/learning\/194-ia-read-about-tds-on-immovable-property\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"194-IA - Read About TDS on Immovable Property - Enterslice\" \/>\n<meta property=\"og:description\" content=\"The section 194-IA of the income tax act reads about the implications and pentalty of TDS on sale or purchase of Immovable Property\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterslice.com\/learning\/194-ia-read-about-tds-on-immovable-property\/\" \/>\n<meta property=\"og:site_name\" content=\"Enterslice\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/enterslice\" \/>\n<meta property=\"article:published_time\" content=\"2019-09-11T14:00:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-09-11T11:33:15+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/09\/tds-on-immovable-property.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@enterslice\" \/>\n<meta name=\"twitter:site\" content=\"@enterslice\" \/>\n<!-- \/ Yoast SEO plugin. -->","authorName":"Savvy Midha","authorImageUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/10\/Savvy-Midha.jpg","authorDescription":"\"Savvy Midha holds the degrees of Bachelor of Commerce(honors), LL.B and Company Secretary. She is an experienced Legal and Financial writer with expertise in research, drafting, and copy-writing.\"","postViews":592,"readingTime":4,"nextPost":{"id":24532,"slug":"foreign-direct-investment-fema-rbi-compliances-checklist"},"prevPost":{"id":24458,"slug":"section-73-of-the-income-tax-act-1961%ef%bb%bf"},"featuredMediaUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/09\/tds-on-immovable-property.jpg","postTerms":"Startup","_links":{"self":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/24482"}],"collection":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/users\/24"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/comments?post=24482"}],"version-history":[{"count":0,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/24482\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media\/24496"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media?parent=24482"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/categories?post=24482"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/tags?post=24482"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}