applicability of tds

[Guest]

Dear sir,

We are paying rupees one crore for compulosry aquisition of private properties for road widening as compensation.

I would like to know the applicability of TDS under income tax for the above payments, the monetary limits  and the rule position and the rate of income tax for such payments.

thanking you sir

chakravarthy

 

[CAGOPALJI AGRAWAL]

Presuming that you are making payment to resident, there would not be any TDS on compensation amount.

[CAGOPALJI AGRAWAL]

In previous reply, I have taken the presumtion of property being agricultural otherwise tax would be deducted u/s 194LA @ 10% if such compensation is more than 1 lac. W.e.f. July 1, 2012, the limit is 200000/-

AI Summary

Tax Deduction at Source on compensation for compulsory land acquisition applies where property is non agricultural and exceeds threshold. Where recipient is a resident, compensation for compulsory acquisition of land is not subject to TDS if the property is agricultural; for non agricultural property statutory withholding applies when compensation exceeds the prescribed monetary threshold and the statutory rate is applied to such withholding.