• TDS applicable on buying from NRI (Jointly owned property)

Q-1- What is the %TDS on property of 1cr , If its jointly owned Husband NRI & wife resident Indian (share of % not mentioned in agreement).

Q-2- Owner insisting on all money transfer to his NRO account, not to his wife's a/c

Q-3-Owner is providing Lower tax certificate , do i need Lower Tax certificate from both owners ?
Asked 7 days ago in Capital Gains Tax from THANE, Maharashtra

If nothing is mentioned in the deed then it is deemed that percentage is 50% each.

Even if you are paying whole amount to husband you need to deduct TDS on wife's share also.

You don't need any certificate for wife as she is resident you need to deduct 1% on her share of consideration.

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Naman Maloo
CA, Jaipur
1204 Answers
11 Consultations

5.0 on 5.0

Please check the TDS certificate provided by the husband what consideration he has shown and how TDS has been calculated.

If nothing is mentioned anywhere then it will be considered as 50L each for TDS matter.

Naman Maloo
CA, Jaipur
1204 Answers
11 Consultations

5.0 on 5.0

1. It deoedep upon who funded the property. Whether it's wife or husband. If it's wife(resident) then, TDS is 1%. If it's husband (NRI) then TDS is 20%. Because, as per income tax the person who have funded the property is the owner.

 

2. Depends upon above question. Who funded the property.

 

3. Yes, you should take it from both of them, if both have funded the property.

Lakshita Bhandari
CA, Mumbai
2812 Answers
116 Consultations

5.0 on 5.0

- As the payment is made to his NRO account,deduct TDS @ 22.88% on Rs. 1 Cr.

- If the husband is providing lower tax deduction certificate then deduct TDS according to the certificate on whole Rs.1 cr.

- You need to obtain TAN and deposit the TDS u/s 195 and file the TDS returns.

- TDS will be deducted u/s 195 and TDS return will be Form 27Q.

- Collect all the documents from the NRI payee.

Vivek Kumar Arora
CA, Delhi
2270 Answers
100 Consultations

5.0 on 5.0

Hi,

 

Hope you are doing well !!

 

-You have to deduct tds@20% (plus applicable surcharge & cess) of the sale consideration as tax before making the net payment to seller.

 

*TDS rate is 22.88 (including surcharge & cess) per cent of the deal value if the property is worth anywhere between Rs 50 lakh and Rs 1 crore.

 

-You should first obtain TAN under section 203A of the Income Tax Act, 1961 before deducting TDS. 

 

-Yes, you should take lower tax certificate from both owners

 

 

Payal Chhajed
CA, Mumbai
1893 Answers
14 Consultations

5.0 on 5.0

Hi,

 

1. TDS@22.88% needs to be deducted on total property value.

 

2. Yes, it is better to take the certificate from both.

 

3.Buyer (you) should have TAN (Tax Deduction and Collection Account Number).

 

Note: – It is advisable to surrender the TAN number once the transaction for the purchase of property has been completed in order to avoid notice for non-filing TDS return.

Karishma Chhajer
CA, Jodhpur
936 Answers
4 Consultations

5.0 on 5.0

 

It is important to know who is the legal owner of property.  The details of bank account where money is to be transferred should be specified in the transfer registration deed to be signed by both the owners.  Since, the seller is NR and money is to be transferred to him, tax will be deducted at 20%.

 

In case, you are transferring money to both, then lower deduction is required for both.  Lower deduction certificate is issued PAN wise.  If lower deduction is not there than tax will be deducted on behalf of both husband and wife in the ratio of ownership.  Also, you need to file Form 26 QB after deducting taxes on payments made each time.

Jasmina Jain Shah
CA, Greater Mumbai
235 Answers
3 Consultations

5.0 on 5.0

Payal Chhajed
CA, Mumbai
1893 Answers
14 Consultations

5.0 on 5.0

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