Getting a Lower/NIL TDS deduction certificate

Ushma & Associates

Getting a Lower/NIL TDS deduction certificate:

A person who is liable to make payment of specified nature to any other person shall deduct tax at source and remit the same into the account of the Central Government which is called TDS i.e Tax deducted at source or withholding tax. The person from whose income tax has been deducted at source would be entitled to get credit of the amount so deducted on the basis of Form 26AS or TDS certificate issued by the deductor.

If NRI is planning to purchase a property in India then he shall deduct withholding tax on making each payment of sale consideration to seller. Similarly, if resident is buying a property from non-resident, he shall also deduct TDS from sale consideration. Once TDS is deducted it shall be deposit to the income tax department on seller’s behalf through filling a prescribed challan and making an online payment. After that a TDS return shall be filed with specified dates and then TDS certificate shall be given to deductee for his records.

TDS return filing can be monthly or quarterly depending on case. In case of NRI seller, buyer shall deduct TDS at higher rate and shall file tds return (Form -27Q) which can be filed quarterly only. It is necessary to submit the TDS returns on time. It’s an online process. Once the TDS returns are submitted the details will come up on Form 26 AS. While filing the TDS returns the various details are to be filed like PAN of the deductor and the deductee, amount of tax that is paid to the government, TDS challan information etc. In case of NRI seller, buyer shall have Tax collection and deduction number (TAN).

In nutshell, TDS shall be deducted at the time of making specified payments and has to be deposit within the stipulated time to income tax department through filling challan and making online payment. Then TDS return shall be filed within stipulated time.

Due Date for filing TDS Return filing in case of NRI seller (27Q)) :

If the assessee is failing to file the TDS returns before the due date then there is a penalty of Rs.200 under Section 234 E per day by the assessee until the time the default is continuing.