TDS on Sale of Immovable Property u/s 194IA
Keeping in view the rising number of unaccounted transactions in real
estate sector, the Government of India made a new reform applicable w.e.f June 2013 as per which the purchaser of
immovable property with value of Rs. 50 lakh and above should deduct 1% TDS at the time of making
payment to the seller. The deal amount net of TDS shall be paid to seller and
remaining shall be withheld by the buyer. The amount of this TDS should be
deposited with Government within 7 days from the end of the month in which TDS
is deducted. Here is the guide about
making payments of TDS by way of Form 26QB and obtaining form 16B for the buyer.
This reform has been made to Income tax act by introducing section 194IA to the
Act. The biggest relief that this section provides is that for complying with
the provisions of this section there is no need to make an application for
TAN(Tax Deduction and Collection Account Number).
Here is how you can make payment of TDS online:
Firstly go the following link
Then click on Form 26QB – Payment of TDS on Sale of Property
As soon as you click, Form 26QB will be opened in front of you
General Instructions:
Select (0021) in case of non corporate payer and (0020) in case of
corporate payer. On filling in the various details called for in that form,
click on ‘Proceed’ at the bottom of the page, this will then take you to the
next page, which will give you the option to select your bank. Once you select
the bank, then login using the normal online process for your bank.
Once the payment is made the bank will let you print challan 280 with a tick on
(800), which is payment of TDS on sale of property. Take a printout of the
challan and keep the same for your records and for the builder/seller if required.
This is the first phase of the process.
Common mistakes:
Please make sure you select correct Financial Year and Assessment year.
Assessment year runs behind Financial Year.
PAN of both buyer and seller will have to be provided.
In case multiple seller’s buyer you will have to fill 26QB forms
equivalent to number of sellers.
In case seller don’t have PAN this transaction can’t be made effective
since payment can’t be deposited in absence of PAN of either of Buyer or
Seller.
This TDS is applicable at time of payment, so in case of multiple payments
TDS will have to be deposited in parts at each payment transaction.
There is also alternative mode payment if one does not have online
banking registration.
One can fill in the form as above & while proceed there is
option of “Subsequent payment through bank”
Choose that & it allows you to generate online receipt for
Form 26QB with Acknowledgement Number. The receipt will be valid for 10 days
from the date of generation online. The amount can be paid by visiting any of
the authorized banks (list is given on the TIN.NSDL site) with cheque.
Bank will do online payment for you & generate Challan.
Second Step:
Generation of Form 16B:
Once this is completed one has to wait for seven days for the details to be reflected on TRACES
web site – https://www.tdscpc.gov.in/.
As a first time user, you will have to register on this website as Tax
Payer with your PAN card no. & Challan no as generated while
payment (no need to have TAN as already mentioned above)
Once you register whether as seller or buyer, you will be able to obtain
the Form 16B or 26QB which has been approved and is reflected against your PAN
in your Form 26AS. Check
Form 26 AS after seven days and you will notice that the payment you had
effected against TDS on sale of property is reflected in Part F of the Form 26 AS under
‘Details of Tax Deducted at Source on Sale of Immoveable Property u/s 194(IA)
[For Buyer of Property]. This will give you details such as the TDS certificate
number (generated by TRACES), name of deductee, PAN of deductee, acknowledgement number
(same as above on Form 26QB), total transaction amount, transaction date, TDS
deposited, date of deposit, status of booking and date of booking.
Once the payment is reflected in 26AS as above, you will have to go to
the TRACES again.
Login to the website & Go to ‘Download’ Tab & make application for request of Form 16B
To make a request for download, fill in the nine digit acknowledgment
number & required details like address of property transferred, PAN of
Seller as asked which is reflected on Form 26AS Part F as mentioned above.
It will give application & generates an application request number.
Once the request is placed it will be made available within 10to 15
minutes.
Now, click on ‘Downloads’ tab.
In the dropdown menu click on ‘requested downloads’. You can filter by way of
Request no or by Date filter or just click all requests and proceed.
You can see you request for Form 16B as Submitted/avaialble. If available simply download the file and if the
status is still submitted then you will have to wait for an hour or so. The
password to open the downloaded file is Date of Birth of deductor in DDMMYYYY
format.
You can save the form for your further reference
and also share the same with the seller.
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