Q: Incase of no deductions with eralier payemnts , can the buyer deduct 1% from the last installments . Is there a penalty for TDS not done for earlier payements
Hi, under Income Tax Act, if you make a payment towards purchase of immovable property for an amount of Rs. 5000000 or more than you have to deduct TDS @1%. Hence, in your case even if the property is under construction you are essentially making payment towards purchase of property. So, you will have to deduct TDS on the payment.
HI MAneesh!! When a person is buying an under-construction property, in such cases, the TDS should be deducted when the property is handed over and the final payment is made. For under-construction property, the buyer is considered to hold an interest in the property and for taxation purpose is not considered the owner until completion.
Hi Maneesh!! Tax deducted(TDS) from payments made to seller shall be deposited to the government treasury within 7 days from the end of the month of deduction.
If tax is not deducted at all: Interest at 1% for every month or part of a month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted.