TDS on purchase of Immovable Property above Rs. 50 Lakh
The Central Board of Direct Taxes has notified the new provision of Tax Deducted at Source [“TDS”] on immovable property. The Finance Act 2013 had imposed that purchaser of an immovable property (any land or building other than agricultural land) costing Rs. 50 lakh or more is required to pay a withholding tax. The rate at which the tax is to be deducted is 1%. The amendment is effective from June 1, 2013. The new provision has been introduced by adding Section 194IA. The major objective behind the introduction of the new section is to track real estate transactions that are not being registered.