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Ensure Aadhaar-PAN linkage to avoid 20% TDS on property purchases
ECONOMY & POLICY

Ensure Aadhaar-PAN linkage to avoid 20% TDS on property purchases

Ensure that both your Aadhaar and PAN cards are linked, and verify that the property seller has completed the necessary linking as well. Failure to do so may result in a 20% tax deducted at source (TDS) on your property purchase, as opposed to the standard 1%.

Under the provisions of the Income-Tax Act, if you buy a property valued at Rs 50 lakh or more, you are required to pay 1% TDS to the central government and the remaining 99% to the seller, who can subsequently claim it as credit.

The Income Tax Department has started issuing notices to buyers, six months post the Aadhaar and PAN linking deadline, instructing those who purchased properties exceeding Rs 50 lakh to pay a 20% TDS on their acquisition.

Chartered accountants report that numerous property buyers are receiving these notices because the property seller has not linked their PAN with Aadhaar. To address this issue, chartered accountants are urging property sellers, along with contractors, brokers, professionals, and others, to ensure the linkage of their PAN and Aadhaar to prevent the deactivation of the seller's PAN card and subsequent TDS implications for buyers of properties valued above Rs 50 lakh.

Ensure that both your Aadhaar and PAN cards are linked, and verify that the property seller has completed the necessary linking as well. Failure to do so may result in a 20% tax deducted at source (TDS) on your property purchase, as opposed to the standard 1%.Under the provisions of the Income-Tax Act, if you buy a property valued at Rs 50 lakh or more, you are required to pay 1% TDS to the central government and the remaining 99% to the seller, who can subsequently claim it as credit.The Income Tax Department has started issuing notices to buyers, six months post the Aadhaar and PAN linking deadline, instructing those who purchased properties exceeding Rs 50 lakh to pay a 20% TDS on their acquisition.Chartered accountants report that numerous property buyers are receiving these notices because the property seller has not linked their PAN with Aadhaar. To address this issue, chartered accountants are urging property sellers, along with contractors, brokers, professionals, and others, to ensure the linkage of their PAN and Aadhaar to prevent the deactivation of the seller's PAN card and subsequent TDS implications for buyers of properties valued above Rs 50 lakh.

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