more than R50 lakh. This provision will continue this year too and the finance minister has not tinkered with direct taxes in the interim budget. Analysts, however, say the provision still needs some finetuning as there are a few compliance issues.
The onus of deducting the tax is on the buyer of the property at the time of crediting the amount to the seller. The income-tax department has introduced Form 26QB for compliance where the buyer has to give details like his full name, address and Permanent Account Number (PAN) and of the seller. He also needs to mention the address of the property purchased, the value of the property, date of agreement or booking and the amount paid either in instalments or lump sum. However, the buyer of the property is not required to obtain the Tax Deduction Account Number (TAN).
As per the norms, the buyer can make the payment of the TDS online or through cheque or demand draft within seven days of the end of the month in which the deduction is made. The buyer will issue the TDS certificate, which is Form 16B, to the seller within 15 days of the due date of payment of taxes. The buyer can generate the the certificate from the income tax portal, www. tdscpc.gov.in
The immovable property includes assets such as a house, commercial property and land purchased for commercial or residential purposes. The rate of TDS on transactions of immovable property is 1%. If the seller does not disclose his PAN number, it would be 20%.
There is a penal provision for non-compliance as well. According to Section 201 of the Income-Tax Act, if an assessee fails to comply with the procedural guidelines of TDS provisions, which means deduction or payment of TDS, then the assessee will be treated as a default.
According to Section 201(1A), in case of failure to deduct the tax or short deduction of TDS, an interest of 1% will be levied for every month on the amount of tax, that will be applicable from the date on which the tax was deductible to the date on which