Get ready to pay 20 percent TDS on property purchase if Aadhar – Pan Card is not linked
Get ready to pay 20 percent TDS on property purchase if Aadhar - Pan Card is not linked
By: Pune Pulse
December 11, 2023
Pune: When purchasing a property, it is important to not only link your Aadhaar and PAN cards but also ensure that the seller has done the same. Failure to do so may result in a 20% tax deduction at source (TDS) on your purchased property instead of the usual 1%.
As per the Income-Tax Act, if the property is valued at Rs 50 lakh or more, the buyer must pay 1% TDS to the central government and the remaining 99% to the seller, who can later claim it as credit.
The Income Tax department has recently initiated the process of sending notices to individuals who have bought properties valued at over Rs 50 lakh, demanding them to pay 20% TDS on their purchase. This action comes almost six months after the deadline for linking Aadhaar and PAN cards had passed.
Chartered accountants have reported that numerous property buyers have been issued these notices due to the failure of the property seller to link their PAN with Aadhaar.
Chartered accountants have thus advocated for property sellers, in addition to contractors, brokers, professionals, and others, to ensure the linkage of their PAN and Aadhaar.
Typically, the PAN card of the property seller becomes non-functional if it is not linked with Aadhaar. Consequently, buyers are being issued notices after a few months to settle their TDS obligations for acquiring a property worth more than Rs 50 lakh from a seller whose PAN card is deactivated.
