InvestorQ : There are some important changes made in the budget to the TDS deduction. Can you explain the actual implications?
Angel dcosta made post

There are some important changes made in the budget to the TDS deduction. Can you explain the actual implications?

Answer
image
Anamika Sodhani answered.
1 year ago
Follow

There have been some important changes to the TDS deduction on a variety of payments. Let me highlight some important changes that could be useful for you to know.

· When an immovable property is sold, the definition of property value has been expanded to include a lot of other things. Now when the transfer of immovable property is made after September 01st 
2019, the TDS will be applicable on the value of the sale of property plus the other charges like club membership charges, car parking charges, electricity and water charges, maintenance fee, advance fee paid etc. In short, all charges that are incidental to the transfer of property will be included in this and the TDS will be deducted on the overall value.

· Now there will be nothing like not obliged to deduct TDS. If any contract fees or charges payable to any person is more than Rs.50 lakhs in one year then in all such cases, at least 5% TDS will have to be deducted effective from September 0-1 st
2019. You can deduct TDS based on the PAN and don’t require TAN for the same.

· There is an interesting item that has been introduced and that is the TDS on cash withdrawals above Rs.1 crore in aggregate in one financial year from a bank account. The TDS of 2% will be deducted on such withdrawals from the bank or the post office and only net amount will be paid. Of course, this is not a tax and just a TDS and you can claim this amount as refund while filing your tax returns. The idea here is more to keep a track of large cash transactions.

· Currently, non-exempt life insurance policies that payout the sum with bonus has to deduct TDS at 1% on the value paid out. Effective from September 01st, 2019, the insurance company will have to deduct TDS at 5%.

These are the major TDS changes that you need to know about.






7 Views