• TDS on purchase of under construction property

Hello Team,

I am in process of buying an under construction property with my Wife as First owner and myself as second owner. However I am funding 100%.

Questions I have are as followed: 
[a] When it comes to deducting TDS, should I deduct 100% TDS for all the payment under my PAN? Is this right thing to do?
[b] What if builder insists to deduct 50% under my wife PAN and 50% under my PAN? Any future tax implication of following this? Will IT department come up with query for source of fund to my wife? 
[c] What amount should I fill in "SCHEDULE AL" for "Loans and advances given" in case of [b]? 100% amount or 50% amount?
[d] When I rent out this property in future, I know I am liable to pay the tax on full rent; However 50% of rent would be considered as my wife's own money for all future usage? 
[e] When I resale, what is split amount received between me and my wife for tax and future usage purpose?
Asked 9 months ago in Property Tax

a) Yes you should deduct the entire TDS

b) He will not insist

c) 100% amount in your ITR

d) 100% rent will be considered your income

e) 100% LTCG would be considered your income


For detailed discussion you may opt for phone consultation

Vivek Kumar Arora
CA, Delhi
4871 Answers
1058 Consultations

5.0 on 5.0

1. No, its advisable to be according to ratios 
d. As per % of ownership 
e. Same a above

Vidya Jain
CA, Kolkata
1012 Answers
58 Consultations

4.8 on 5.0

a)  Ideally it should be in the ratio of ownership


b) No that's not concern, even if you are paying 100% amount. Ideally that amount stand as loan to your wife for purchase of property


c) 50% amount only and mention about joint ownership


d) you can split the rent 50%


e) Capital gain will also attract based on 50% ownership

Vishrut Rajesh Shah
CA, Ahmedabad
928 Answers
39 Consultations

5.0 on 5.0

Ideally if you are mentioning both parties name you both should fund the property equally otherwise it become very tricky for TDS as well as calculating capital gain etc.


However, if she is not earning anything don't include her name in purchase deed.


Ideally if you are only making payment 100% then you should deduct TDS on same but sub registrar would report name of both parties as her PAN would also be mentioned in deed.


As per deed you both are 50% - 50% owner.


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

Thank you.

Naman Maloo
CA, Jaipur
4285 Answers
98 Consultations

5.0 on 5.0

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