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Finance Act 2013 has inserted section 194IA whereby any payment made on or after
01.06.2013, for acquisition of any immovable property other than agricultural land is
subject to TDS @ 1% where the aggregate consideration is equal to or more than
Rs. 50 Lac.
Unit buyer has to deduct tax at source at the time of actual payment or credit of such
sum to the account of the transferor / seller, whichever is earlier.
TDS has to be deducted on the Gross Invoice Value including the amount of taxes if
any, excluding service tax portion separately shown in the invoice as per CBDT
circular No.1 dated 13 January 2014. This is because TDS is applicable on “any sum
paid by way of consideration”.
For our south projects where the agreement is divided into two parts viz. Sale of
undivided share of land and construction contract, there also TDS is required to be
deducted as per the provisions of section 194IA only. It is possible that tax was earlier
being deducted under section 194C on the construction contract by certain assesses
but now it is advisable if all deductions are made under section 194IA.
Once the certificate is received we shall check the credit appearing in the Form 26As
of the Company. In case of any discrepancy, we shall inform you and the concerned
branch will have to immediately deal with the customer and rectify the matter before
the next instalment is received.
TDS has to be deducted on the entire amount paid as consideration for acquisition of
property. However pass through payments made to the seller viz. Maintenance
Charges, Share Money, Corpus Fund, any other pass through Government / other
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payment shall not be subjected to TDS. It is preferable if separate invoices for such
charges are raised on the customers.
In case the customer has availed the Bank Loan on property than the Bank has to
comply with TDS requirement on behalf of the customer and in case the bank is
unable to comply with the requirement than the customer has to ensure that he / she
complies with the TDS requirements.
In case the property is purchased in joint names, than the person who is actually
making the payment has to comply with TDS requirements. In case both parties are
making the payment then the TDS requirements are to be fulfilled by both parties.
TDS deducted during a particular month has to be paid by 7th of next month.
The amount of TDS deducted has to be paid electronically ONLY using Form No.
26QB. Manual payments by using any other tax challan are not permitted under any
circumstances.
List of Authorised Banks through which electronic payment of tax can be made is
attached herewith as Annexure – I.
To access the form, the user has to visit www.tin-nsdl.com website. On the top left hand
side, select the option “Services”. Under this, select the last option “e-payment: pay
tax online”. This will take you to a new page. There select “TDS on sale of property”.
The prescribed form 26QB (copy attached) will appear. Fill in the required details.
The provision to make the payment is included in this challan. No separate e-tds
return needs to be filed for this tax deduction.
Every person responsible for deduction of tax under section 194IA of the Act shall
furnish the certificate of deduction of tax at source in Form No.16B to the payee
within fifteen days from the due date for furnishing the challan-cum-statement in
Form No. 26QB.
Form 16B is to be generated online from the web portal within 15 days from the due
date of deposit and must be downloaded from the TDSCPC website. Once the
certificate is downloaded, it must be signed and stamped and then sent to the
Transferror / Seller.
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Few important instruction for filling up Form 26QB while making the online payment
of TDS:
While selecting the Tax applicable please select “(0020) Income- tax on Companies
(Corporation Tax)” in case payment is made by Company.
While selecting the Tax applicable please select “(0021) Income- tax (Other than
Companies)” in case payment is made by person other than Company.
In the attached Form 26QB under the heading PROPERTY DETAILS – under
Column - Total Value of Consideration (Property Value) – Please mention total
consideration including the amount of applicable taxes for the property being
purchased. Pass Through payments viz. Maintenance Charges, Share Money,
Corpus Fund, any other pass through government payment should not be included in
Total Value of Consideration.
The actual payment being made should also be computed accordingly and Pass
through Payments should not be included.
Information required form our side for filing up Form 26QB is as under:
Tax Applicable :
Customers are requested to quote their customer code no on the back of the TDS
Certificate provided to us.
Please note that in case you require any information / clarifications, we request
you to please approach us.
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Sr. No. Name of the Bank
1 Allahabad Bank
2 Andhra Bank
3 Axis Bank
4 Bank of Baroda
5 Bank of India
6 Bank of Maharashtra
7 Canara Bank
9 Corporation Bank
10 Dena Bank
11 HDFC Bank
12 ICICI Bank
13 IDBI Bank
14 Indian Bank
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22 State Bank of India
26 Syndicate Bank
27 UCO Bank
30 Vijaya Bank
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