• TDS against sale of property

I have sold my flat , me and my wife are the owners of the flat.And the buyers of the flat are two . But while deducting tax only one buyers PAN number and Only one PAN of mine is used for 26QB.Is it ok ?
I don't have any problem and even buyer doesn't have any problem.
Is it ok or will income tax department will issue notice to other buyer.
Asked 7 years ago in Income Tax

Hi

How the payments have to be made? If both the buyers shall make payments respectively to you and your wife, there would be 4 Form 26QB separately.

If only one buyer is making the payment and the entire payment shall be credited to your account only, then there could be 1 Form 26QB.

Lakshita Bhandari
CA, Mumbai
5687 Answers
943 Consultations

In my opinion its ok to proceed with this arrangement.

Swati Agrawal
CA, Mumbai
1146 Answers
7 Consultations

Two buyers and two sellers so four 26QB needs to be filed.

Vivek Kumar Arora
CA, Delhi
5024 Answers
1146 Consultations

Hi,

If you are paying Capital Gain tax considering yourself as the sole owner, then no problem.

However, if you want to split the Tax Liability between you and your wife, then Your Wife will not be having any TDS Credit

Pradeep Bhat
CA, Bengaluru
542 Answers
94 Consultations

It should be fine till the time you are showing the entire capital gains in your name. Also is the total payment made to you or is it split in your and your wife's account? If the payment is split, then it is advisable to deduct tds from both the account.

Hope that clarifies.

Regards,

Nikhil.

Nikhil Khanna
CA, Mumbai
1429 Answers
19 Consultations

Hi,

There would be no problem with this arrangement just remember one who's PAN is recorded in TDS database can only claim the tax credit in the tax return.

If your PAN is mentioned, then you will be able to claim credit of TDS on the complete sale. The other join owner may report the sale and capital gain part in his tax return but would not get any tax credit because of absence of any credit in his form 26 AS.

Thanks

Damini

Damini Agarwal
CA, Bangalore
510 Answers
31 Consultations

If the name of your wife is in the registry documents and she had financed for the purchase of the sold out house then your wife will also be liable to capital gain and TDS needs to be deducted on her account.

Vivek Kumar Arora
CA, Delhi
5024 Answers
1146 Consultations

If only you are bearing the entire capital gains reason being you being the true owner of the property, TDS deduction can be made in your name only.

The deduction has been made correctly.

Lakshita Bhandari
CA, Mumbai
5687 Answers
943 Consultations

Hi,

If both he buyers are contributing the funds, then ideally both should have deducted TDS and deposited the same with income tax department.

The income tax department may issue a notice to second buyer. However, there are favourable case laws wherein it was ruled that even if one buyer has paid the TDS, it should be ok

Abhishek Dugar
CA, Mumbai
3576 Answers
183 Consultations

Yes, it can be revised, but it's a lengthy and cumbersome process to get the challan corrected.

Abhishek Dugar
CA, Mumbai
3576 Answers
183 Consultations

Ideally TDS should have been deducted by borh the buyers. However I dont think it is a major issue and it should be okay.

Since you are bearing the total capital gains, it should be fine.

Regards,

Nikhil.

Nikhil Khanna
CA, Mumbai
1429 Answers
19 Consultations

This looks fine.

If TDS is filed wrongly, then the same can always be rectified

Pradeep Bhat
CA, Bengaluru
542 Answers
94 Consultations

Hi,.

I understand that you are the seller of the property and 2 joint owners are purchasing the property.

The structure is ok from your (sellers) perspective.

You are getting payment after tax deduction at source and you shall get the credit in your form 26 AS.

The purchaser will have to report the TDS in the TDS return. Please verify from the buyer that he follows the law and get the reporting right.

Damini Agarwal
CA, Bangalore
510 Answers
31 Consultations

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