By Accommodation Times News Service
Those who are selling immovable property without disclosing their permanent account number (PAN) are in for a difficult time with the government mandating a 20% tax deduction at source in such transactions. The new rules that came into effect from 1st June require buyers of immovable property, other than agricultural land, to pay TDS of 1% of the deal size for transactions in excess of Rs 50lakh.
The proposal which was announced in the budget was notified on 31st May, , income tax department officials said. The move is part of the governments drive to clamp down on black money in the system, with real estate transactions seen as a major source of generation of black money. The I-T departments is hoping that through the latest measure at least some part of cash economy would come under check, although it already has information of property transactions above Rs 30lakh. The rules notified on 31st May require all buyers to deposit the 1% TDS electronically on the I-T department website by filling a form online. Those without access to the online system can fill up the form and make the payment at an unauthorized bank branch.