Propery registration

To address your queries regarding plot selling and registration: Registration and Tax Implications: 1. *Registration of Sale Deed*: The sale deed is registered for the guideline value prescribed by the Tamil Nadu government. 2. *Sale Agreement*: The sale agreement reflects the entire sale consideration amount but is not registered. 3. *Voluntary Disclosure*: The seller voluntarily discloses the entire sale consideration amount to the Income-Tax department and pays necessary taxes on long-term capital gains or invests in another property. TDS Deduction: 4. *TDS Calculation*: TDS at 1% can be deducted and remitted by the buyer based on the sale agreement value, which reflects the entire sale consideration. Loan Requirements: 5. *Higher Sale Amount*: If a buyer requires a loan, the sale deed can reflect a higher sale amount above the guideline value, depending on the loan requirement. This is a common practice but ensure compliance with income-tax laws and regulations. Additional Considerations: - *Stamp Duty*: Ensure that stamp duty is paid on the higher sale amount reflected in the sale deed. - *Income-Tax Implications*: The seller should consider the income-tax implications of disclosing the entire sale consideration amount and paying taxes accordingly. - *Compliance*: Ensure compliance with all applicable laws, including income-tax laws, stamp duty laws, and registration laws. It's essential to consult with a tax professional or financial advisor to ensure accuracy and compliance with the latest tax laws and regulations.

Will do.

Just to summarise your reply :

We can register sale deed with Guideline value or the higher amount and accordingly stamp duty is to be paid.

Sale agreement will have full sale consideration based on which we can comply with Income tax requirements.

Thanks again

The stamp duty is payable on the sale deed on the consideration of the sale or the guidelines value whichever is higher.  The IT department also levies the tax as per the consideration or guideline value whichever is higher.

Well explained by Shri KAVK Satyanarayana Sir, i concur with his opinions

Namaskaram

Thanks Sri Sathyanarayana and Sri Kalaiselvan.

In the case narrated, we are the seller. We intend to comply with the requirements. We feel, if the registration is done based on Guideline value, it will be the responsibility of buyer to answer income tax queries later  when source of funds is asked. No cash transaction is proposed. We intend to get full money by bank transfer. Only thing is that buyer wants to register for guideline value.

Please clarify again.

Thanks

The buyer may have to pay the appropriate stamp duty as per the guidelines value.

The seller can show the difference amount as income from other sources in his ITR 

Namaskaram Mr. Narasimhan, let me quickly asist you here..

In property transactions, the sale deed is registered at the guideline value prescribed by the Tamil Nadu government, while the sale agreement reflects the actual sale consideration but remains unregistered. The seller, in compliance with income tax laws, voluntarily discloses the full sale amount to the Income-Tax Department and either pays the necessary capital gains tax or reinvests the gains as per tax provisions.

Regarding TDS deduction, 1% TDS is to be deducted and remitted by the buyer on the full sale consideration as per the Income-Tax Act. If the buyer seeks a loan, the sale deed can be registered at a higher value above the guideline rate, provided proper stamp duty is paid. The stamp duty and income tax liabilities are determined based on the higher of the guideline value or actual consideration.

If the sale deed is registered at the guideline value, the onus is on the buyer to justify the source of funds if questioned by tax authorities. The seller should report the actual sale consideration in the Income Tax Return (ITR), treating any excess amount beyond the guideline value as income from other sources, if applicable.

For further legal consultation, contact me at adv.vishesh@icloud.com.