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News INCOME TAX

  • Jun 04, 2024
  • TDS on property is 20% if you have not linked PAN with Aadhaar by May 31

    Taxpayers had until May 31, 2024, to link their PAN with Aadhaar. Failure to do so will result in a higher Tax Deducted at Source (TDS) being levied on their income. This applies to transactions entered into before March 31st, 2024, with the TDS rate doubling for those with unlinked PANs.
    "The IT department has given a final deadline for 31st May 2024 for linking PAN with Aadhaar. In case assessee still fail to do so, this will tantamount to PAN being inoperative and will attract section 206AA whereby deduction shall be @ 20%," said Ritika Nayyar, Partner, Singhania & Co.
    The situation was particularly frustrating for homebuyers who unknowingly purchased property from sellers with unlinked PANs. These buyers faced notices demanding additional tax due to the higher TDS rate. However, a recent CBDT circular provides relief. If the seller links their PAN with Aadhaar by May 31st, the homebuyer will be off the hook for the additional tax.
    The income tax department in April 2024 provided relief to many homebuyers who were issued tax deduction at source (TDS) notices because the Permanent Account Numbers (PAN) of the property sellers were inoperative. The circular gave the homebuyers a chance to avoid the tax notices as long as the property sellers link their PAN with Aadhaar by May 31.