TDS when buying property from NRI seller

Hi

Tax rate shall be 20% plus cess and surcharge as applicable.

You will need a TAN for this.

You need to deduct taxes and then make the balance payment to the seller.

The NRI seller may also apply for NIL or Low deduction certificate after taking into consideration his tax liabilities on such transaction.

Hello,

You would be required to deduct TDS at 20% plus cess and surcharge as applicable u/s. 195. TAN is required in case the property is purchased from a Non-Resident.

I hope this answer satisfies your requirements. 

Regards,

CA Hunny Badlani

- If sale value is more than Rs.50 lacs and less than Rs.1 cr then you should deduct TDS@22.88% on SALE VALUE and NOT CAPITAL GAIN . Do not rely on the seller for the TDS liability.

- Yes you need to obtain TAN and file the TDS return.

- Seller can obtain NIL or lower tax deduction certificate. It is applied online.

Dear Sir,

Hope you are doing well !!

It is always advisable to apply for NIL Tax Deduction / Tax Exemption / Lower Tax Deduction Certificat

It is your liability to deduct especially in case of NRI even if the amount of transfer is less than 50 lakh as same would be covered under 195 and not 194-IA.

Having a PAN card doesn't make a person resident.

You should deduct 20.8% TDS if the gain is long term gain.

You need to file Form 27Q and for that you would need TAN.

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

Thank you.

- I can assist seller in getting it. text me on my email  aroravivek1982@gmail

- No, you should deduct entire TDS and deposit it.

1. That has to be obtained from the income tax department. The application has to be made online in form 13.

2. No. You are required to deduct TDS @20% plus cess and surcharge. Or else you will be an assessee in default.

We may assist you in entire procedure.

No, you need to deduct full TDS. 

From the Income tax Assessing officer of local Income tax department.

No it would lead you to payment of interest on lower deduction and might even lead to penalty.

Hi,

Please refer to replies in line below:

- An application for lower TDS deduction certificate is required to be made to Assessing officer. Basis his judgement, certificate is granted or refused. An Indian CA would be assist you in this process of obtaining lower TDS deduction certificate.

- As per the provisions of the Income tax act, TDS deduction in the said case has to be on a higher rate. However, if you are unable to deduct more than 1% TDS on account of buyer's refusal, then to be safe, take a declaration from him in written in this regard. Ideally tax officer cannot recover the taxes from the buyer as the tax is levied on the income of an individual and in the sale of property, the income is earned by the seller, hence the tax incidence falls solely on the seller. TDS deduction by the buyer is just a measure of control placed by the income tax laws to avoid sale of property transactions escaping tax reporting. 

You do not need TAN for filing TDS deducted.

Thanks

Damini

1. Low deduction certificate is obtained from the assessing officer. A practicing CA would help for the same.

2. No, you should deduct the full due TDS as applicable.