I recently got an auctioned property from a bank where the defaulter is an NRI. I have made 25% of the payment. Before filing for Tax Deducted at Source (TDS), the bank realized that TDS for NRIs is 22% on capital gains. How do I deal with this situation?






Charan Charan
Answered on February 05,2020

TDS compliance is required when an auctioned property is being purchased. Even though the bank is auctioning the property, TDS must be deducted on the Permanent Account Number (PAN) of the original owner. TDS rate for NRIs is 20% (additional cess and surcharge, as applicable). Ideally, the bank should be able to provide information about NRIs’ PAN to you. You can adjust TDS on the subsequent payment you make; remember that it is required to be deducted from each instalment paid. You must make sure that TDS is adjusted from payments made by you and duly deposited to the government with any interest applicable. The onus of TDS compliance is on the buyer.


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