Buying shop from NRI

No that's not correct.

In case of purchasing property form NRI first you should ask a certificate from your seller which he will provide you from his AO which will mention his capital gain amount and TDS amount. You need to deduct TDS at that amount.

If he cant provide you with that then you need to deduct TDS from sellers amount on sale value and that needs to be done at 30% and not 20% as 20% is for TDS on long term capital gain amount.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

If he can't provide the details of capital gain then as per law you must deduct tax @30% even if it qualifies for long term capital gain as you don't have any proof.

To be safe i would suggest you to deduct tax @30%.

Yes the article is true but such capital gain should only be considered by you if he provides proof of such long term capital gain and that can be done by certificate and if he is not doing so i would suggest that you would fall under last point of 195 and thus deduct TDS @30%.

Although there are many articles supporting your contention but I think it would be right to deduct tax at 30% if he is not providing any proof.

Yes the procedure you have mentioned is correct but since both of you are deducting TDS you both need to file Form 27Q as Form 27Q is based on TAN number as since you will deposit TDS with your wifes TAN number also you need to file such form separately.

Hi Ravi,

Hope you are doing well !!

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

-Form 27Q is to be filled in by each buyer for unique buyer-seller combination for respective share.

In the absence of certificate from seller, you need to deduct the TD on total sales value.

Yes, the procedure is correct except point no. 3.

Form 27Q is to be filled in by each buyer for unique buyer-seller combination for respective share.

Yes, it will be qualify for Long term, but if he is not providing sufficient proof for holding property then you should deduct tds@30% +Surcharge and cess As per Income tax slabs.

However the seller can claim refund of excess TDS paid at the time of Income Tax return.

Hi,

- As you are making payment to the NRI against capital gain on sale of immovable property, TDS rate would be 20.8% including cess @4% on the sale value of Rs.18,75,000.

- If both husband and wife holds 50-50% share in the property then you need to mention it clearly in the sale deed and the payment of the respective share should be made from the bank accounts of both the parties. Yes you both are required to file challan 281.

- Yes you both are required to file Form 27Q individually. 

- 2 times respectively by husband and wife.

- Yes ,you need to issue Form 16A.

Thanks

Hello,

While buying property from NRI, ideally you are required to deduct TDS on the capital gain amount of the NRI but for that, the seller(NRI) will have to get a Certificate for lower deduction from the income tax officer. In case this certificate is not obtained by the NRI seller, you will be required to deduct TDS on the sale value of the property.

Since your NRI seller is not getting the certificate, you will be required to deduct TDS @20.8% of the sale value i.e. 18.75 Lacs.

Yes, you will be required to file Challan Form 281 for you and your wife.

You both will be required to file Form 27Q.

You will also have to issue Form 16A to the NRI seller.

I hope this answer satisfies your requirement.

Regards,

CA Hunny Badlani

Hi,

Yes the procedure mentioned by you is correct. In point 3, you will have to file 27Q two times...one for you and one for your wife.

Yes, it will be long term capital gains nd TDS has to be deducted on 20% of sale proceeds.

Hello Sir,

Yes, your understanding is correct about the procedure.

However, you will have to file 27Q for your share as well as for your wife share.

Hi

27Q to be filled two times,

else your understanding is correct.

Hope it helps