applicability of tds

[sid chakravarthy]

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

 

AI Summary

Clarification on TDS for compensation in property acquisition: No TDS for agricultural land; 10% for non-agricultural over 2 lakh. A discussion on the applicability of Tax Deducted at Source (TDS) for compensation payments related to the compulsory acquisition of private properties for road widening. The query seeks clarification on TDS rules, monetary limits, and applicable tax rates. A respondent clarifies that if the payment is made to a resident, no TDS is applicable on compensation for agricultural property. However, for non-agricultural property, TDS is deducted at 10% under section 194LA if the compensation exceeds one lakh rupees, with the limit increased to two lakh rupees from July 1, 2012.