Budget 2019 – TDS on gross amount including incidental charges while purchasing of immovable property

Any person (buyer) who is liable to make payment while purchasing immovable property should deduct TDS mentioned u/s 194 – IA. If amount of ‘consideration’ payable for transfer of immovable property is Rs. 50 lakhs or more TDS will be deducted u/s 194 – IA.

The term ‘consideration’ is currently not described for purposes of section 194 – IA. There are other different types of payments made while purchasing of immovable property and the buyer has to make such payments to the seller under the same or different agreement. An explanation proposed to be included in Section 194 – IA to provide that the term ‘consideration for immovable property’ will include all incidental charges of club membership fee, car parking fee, electricity and water facility fees, maintenance fee, advance fee etc.

This amendment will take effect from 1st September, 2019

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Budget 2019 – Relaxation of Section 201 in respect of payments to non-residents

If the deductor fails to deduct whole or any part of the tax or he fails to deposit the tax to credit of Central Govt. he will be considered to be assessee-in-default. The deductor will not be treated as assesse-in-default if payment is made to a resident who paid tax on such income and has mentioned it in return submitted u/s 139. The payer will get a certificate from a Chartered Accountant in Form 26A and submit it. At present it was only for payment made to resident person. In case of failure on payments made to non-resident such relaxation was not for the deductor.

The amendment is made thus where deductor fails to deduct tax from sum paid to resident or non-resident but he is not considered as assessee-in-default, he will be responsible to pay interest from date on which tax was needed to be deducted to the date of filing of return of income by payee.

This amendment will take effect from 1st September, 2019

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7th December – due date for TDS & TCS payment for November

7th December, 2019 is the due date for TDS and TCS payments for the deductions made in November 2019. Make sure to do the needful on time to avoid interest. To understand the details / calculations for late payment interest click on the links below.

Calculation of Late Payment Interest

Interest on Late Payment of TDS

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Budget 2019 – TDS from withdrawals of cash exceeding Rs. 1 Crore

A new Section 194N proposed to be included in Income Tax Act. If the withdrawal of cash exceeds Rs. 1 crore in a financial year a 2% of TDS will be deducted  by a bank or post office from withdrawn cash of savings or current account.

However no TDS will be deducted if cash is withdrawn by following recipients from bank or post office:
a. Union or State Govt.
b. Banks
c. Co operative Banks
d. Post Office
e. Banking Correspondents
f.  White label ATM operators
g. Other persons notified by Govt. in consultation with RBI.

This amendment will take effect from 1st September, 2019

Click here to Download Copy of Press Release

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