Is the amount received from the builder taxable?- Property News
August 11, 2016
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4:05Now PlayingIs the amount received from the builder taxable?- Property News
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as posted by the channelExpert: Pannkaj Ghadiali, Managing Partner at PC Ghadiali and Co LLP.
Question: I booked a commercial space in 2008. I got delivery of it now. However, I sold the property prior to getting delivery. The builder has given me lesser payment and has deducted TDS from the amount. Is the amount received from the builder taxable? I have made a loss on the property.
Answer: There are two issues here - You have said you received lesser payment from the builder. Is it because of the TDS? If that is so, the builder is right in deducting TDS irrespective whether you have made a profit or a loss. You will have to disclose this transaction in your tax return and if you have incurred a loss, there will be no incidence of tax payable. The TDS will be allowed as a credit by way of taxes paid by you and will be refunded if there is excess payment of tax.
The second issue is if the consideration received by you is lower than the value determined by the stamp valuation authority, then as per Section 50 C, the capital gains will be computed with reference to that value instead of the actual consideration received by you.
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