TDS on Property Sale by NRI

[Sandeep Srivastava]

Under Section 195, for NRI seller, Buyer has to deduct 20.6% TDS on Total Sale Value. However Seller CA is insisting that i should deduct 20.60% TDS on CAPITAL GAIN only without any indexation benefit (Selling Price - Noida Authority Transfer Charges- Purchase Price).... CA is ready to give certificate for this .... What should i do... whether on basis of CA certificate , shud i deduct 20.6% TDS on CAPITAL GAIN......Seller is telling that their Income Tax Dept at Dehradun do not issue lower/Nil TDS certificate under Section 197 and they will not issue because they are not asking any rebate in TDS rate..... What to do ?? I also agree that 20.6% TDS on whole sale value is huge money and no seller will be ready for this....

AI Summary

Buyer Seeks Guidance on Correct TDS for Property Purchase from NRI Under Section 195; Seller's CA Suggests Alternative. A buyer is seeking advice on the correct tax deduction at source (TDS) for purchasing property from a non-resident Indian (NRI) seller. The buyer is aware that under Section 195, a 20.6% TDS on the total sale value is required. However, the seller's chartered accountant (CA) suggests deducting TDS only on the capital gain, excluding indexation, and is willing to provide a certificate for this. The seller claims that their local tax department does not issue a lower or nil TDS certificate. The buyer is concerned about the high TDS on the total sale value and seeks guidance.