Section 194IC – TDS on consideration paid under a Joint Development Agreement

1. Time of Deduction- At the time of credit or payment, whichever is earlier.
2. Deductor- Any person paying any sum by way of consideration under Joint Development Agreement.
3. Deductee-
4. TDS Rate- 10% of the sum paid.
5. Meaning of Joint Development Agreement- This is an agreement between the owner of an asset (being land or building or both) who agrees to allows another person to build a real estate project on such asset, in return for share and/or payment in cash.
6. Note- Capital Gains are taxable in the hands of the assessee in the PY in which certificate of completion is issued by competent authority. Thus, TDS credit u/s 194IC shall be claimed by the assessee in the year in which capital gains are taxable.

∼Authored by – CA Anushka Saraogi∼

Section 194IA- Payment on Transfer of Immovable Property