TDS payment on New Property

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  1. brb

    brb New Member

    I registered the agreement of a flat booked with a builder in the month of March 2015. I have paid only 50% of the payment towards the property. Builder asked me to make payment of TDS on the entire agreement value @ a rate of 1%, which I complied and paid the TDS though form 26qb in the month of October 2015.

    My question is - by when are we supposed to pay the TDS - is it in the same financial year of the property registration? If paid in next financial year, have I missed a deadline and need to pay penalty or so?
  2. Yashveer Jain

    Yashveer Jain Member

    section 194IA states you need to make payment within 7 days from the date of payment to the builder. Incase of default you are liable to pay interest depending on the situation.
  3. brb

    brb New Member

    Its only partial payment done to builder, not the entire amount of the property. Moreover, I am paying him stagewise completion of construction -- may in 20 installments which is going to go upto December 2016. Does it mean I keep paying TDS every time I pay the builder? (within 7 days of that payment). That sounds impractical, isn't so?
  4. V K Khanna

    V K Khanna Active Member

    Your TDS liability arises when you make payment to the Builder. If the payment is being released in 20 instalments, you have to deduct the TDS everytime and deposit in Govt Account. This is unavoidable.
  5. brb

    brb New Member

    Ok. Thanks.
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