194IA APPLICABILITY/TECHNICAL ISSUES

[hubert fernandes]

 

194IA Inserted vide finance act qef 01.06.13,

whether is it applicable for ongoing real estate projects where the agreement for sale is executed prior to 01.06.13 ?,

If  part payment of the the consideration on such sale of apartements in ongoing projects(ie agreement executed/registered prior 01.06.13) is paid to the builder/developer  prior to 01.06.13, whether TDS has to be deducted on balance payable to builder or even on the amout paid prior to june 2013?

Assuming that a real esate sale take place after 01.06.13, whether the purchaser is required to deduct TDS on the entire consideration on the date of agreement (ie one time) or whether tds is to deduceted as per payment schedule dates as mentioned in the agreement for sale?

what is consideration? whether TDS is to be deducted only on the sale consideration or also on the car park and other outgoing paid(like electricty meter charges, club house, infrastructure tax etc)?

 

AI Summary

Clarification on Section 194IA: TDS applies to ongoing real estate projects post-01.06.2013, includes all stamp duty charges. A discussion on the applicability of Section 194IA of the Income Tax Act, introduced on 01.06.2013, addresses whether tax deduction at source (TDS) applies to ongoing real estate projects where agreements were executed before this date. It is clarified that payments made before 01.06.2013 are not subject to TDS, but the section applies to ongoing projects. The consideration for TDS includes all charges relevant to stamp duty for registration. Additionally, payments for rights in immovable property, including plant, machinery, and other fittings, are considered part of the sale consideration.