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Priya   20 June 2022

Buying a property flat from oci - tds details?

I am planning to buy a flat for 25 lakhs ( old flat 20 years old)  from an known person but he is now an OCI, Overseas Citizenship of India, settled in Australia. 
We agreed to have registration next month. 
But I heard about TDS of 20.8% that seller has to pay before the registration and submit the receipt on the registration day itself. Is this procedure for OCI? 
My seller is not aware of this. 
1) What are the details I need to inform/check the seller regarding TDS. 
2) What if my seller doesn't agree to pay TDS. 
 Is there any other option? 
3) Can the registration happen without paying TDS, allowing the seller to pay later. 
Need clarity on this TDS part and how to proceed. 

Thank you



Learning

 2 Replies

LEGAL QUEST ADVISORS   21 June 2022

Since the Total Sale Consideration is below Rs.50 Lakh, no need to cut TDS in the sale consideration. however the seller pan card must be mentioned in the Sale Deed. 

Priya   21 June 2022

Thank you sir, but he is OCI,  section 195 says buyer needs to deduct even if it below 50 lakhs. Can you please confirm. 

 https://tax2win.in/guide/section-195-tds-on-nri-selling-property

In case the buyer fails to deduct the TDS (wholly or partly) or fails to deposit the TDS with the Government, then the buyer (i.e. Deductor) would be liable to pay penalty under section 271C. Here, the defaulter would be required to pay penalty amounting to sum equal to the TDS not deducted or TDS not paid.03-Jul-2020


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