Taxes on property

Your Queries:

1. a) Is it applicable only when the seller is a non-builder, or even when the seller is a builder?

b) Also, what is the notification number please?

2. ...., on property sale by builder, is there any service tax on the builder? If so, brief summary please.

3.... in Goa, is there any VAT applicable on the builder when flat is being sold by them?

Replies:

1. a)  It applies even if the seller happens to be a builder.

b) There is no Notification. The requirement of TDS under S.194IA is introduced by the Finance Act 2013.

2. On a sale, there cannot be any Service Tax.

3. I'm not sure.

Thank you for your response.

I request for a clarification.  The new 1% TDS on property purchase rule is applicable from 1st June.

If I have a sale deed with the builder for a completed ready-to-possess flat, executed in May 2013, but payment is to be made in June, would TDS still be applicable at the time of payment?  My presumption was that since the agreement is entered prior to the TDS applicable date, such payment is outside the ambit of TDS.

There is no clarity on the issue as to whether TDS u/s 194IA is to be deducted on payments made after 1st June, 2013 in respect of transfers completed prior to that date. However, reading the provision constructively and also the online challan available on NSDL site, one would note that the date of agreement can be entered only for period after 1st June, 2013. So effectively it is only agreements entered after 1st June, 2013 which are covered under TDS provisions.

Thank you for your response.

 I am selling my house which is valued above 50L ... I understand that under act 194-IA i have to pay 1%TDS... My queries are

1) if I deposit my property selling amount in Capital Gain Account and will buy a new house / flat using my property selling amount.. Can i ask for a 1% TDS return already deducted..

2) What will happen if financial year of property selling and buying is deifferent? Because I am selling property in 2013-2014 and planning to buy new property in 2014-2015... In which year's ITR i have to ask for return...