TDS on payment under joint development agreement w.e.f. 01 April 2017
As per Section 194-IC of Income Tax Act, 1961 (Inserted by the Finance Act, 2017, w.e.f. 1-4-2017 ) Any person responsible for paying to a resident any sum by way of consideration (not being consideration in kind) under a joint development agreement, is responsible for tax deduction under section 194-IC.
1. Who is responsible for tax deduction : Any person responsible for paying to a resident any sum by way of consideration (not being consideration in kind) under a joint development agreement, is responsible for tax deduction under section 194-IC.
· 2.Time of tax deduction– Tax is deductible at the time of credit of such sum to the account payee or at the time of payment thereof in cash or by issue a cheque/draft or any other mode, whichever is earlier.
· 3. Rate of deduction– Tax is deductible at the rate of 10 per cent. If PAN of recipient is not available, tax is deductible at the rate of 20 percent.
· 4. Threshold limit – NIL
· 5. Meaning of joint development agreement- It is a registered agreement in which a land owner (i.e, a person who owns land or building or both) agrees to allow another person to develop a real estate project on such land or building or both, in consideration of a share (being land or building or both) in such project, whether with or without payment of part of the consideration in cash.
Extract of section 194-IC of Income Tax Act, 1961 is given below for reference:
Payment under specified agreement.
194-IC. Notwithstanding anything contained in section 194-IA, any person responsible for paying to a resident any sum by way of consideration, not being consideration in kind, under the agreement referred to in sub-section (5A) of section 45, shall at the time of credit of such sum to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to ten per cent of such sum as income-tax thereon. ]
Business So Simple 
Whether tds is to be deducted under section 194 IC even if refundable security is deposited by developer to landowner at the time of agreement??
LikeLike
No.It is clearly specified us 194 IC that tds is required to be deducted only in respect of consideration not of security.
LikeLike
No.It is clearly specified us 194 IC that tds is required to be deducted only in respect of consideration not of security.
LikeLike
Thanks for sharing this update!Tax Professional
LikeLike
RESIDENT MEANS INDIVIDUAL OR BODY CORPORATE
LikeLike
where can such tds deducted and remitted u/s 194IC be shown in form 3ca/3cb ?
LikeLike
Whether it is deducted on agreement money or amount paid
LikeLike
In a JDA, 50% of consideration has been paid via chq. before applicability of section 194 IC i.e. before 1st April 2017. But the agreement (JDA) was registered after 1st April 2017. In that case whether TDS will be applicable on whole 100% consideration or only on balance 50% since first 50% was paid before levy of section 194IC?
LikeLike
Is TDs to be deducted if the land owner is nri in case of jda and if so what is the rate
LikeLike
IT IS NOT CLEAR IN WHICH TDS CHALLAN THE DEDUCTED TAX IS TO BE DEPOSITED LIKE AS MENTIONED IN SEC.194IA CH.NO.26QB,194IB CH.NO.26QC ETC.THERE IS NO MENTION OF THE CHALLAN NO.PL.SHARE IF ANY ONE HAS THE IDEA
LikeLike
McAfee.com/Activate Since the world is developing each day with new computerized advances, digital dangers, malware, information, and harming diseases have additionally turned out to be increasingly more progressed with every day. These digital contaminations harm a gadget or documents in different ways.McAfee.com/ActivateMcAfee.com/ActivateMcafee is a antivirus software for laptop, PC, Mac for internet security form viruses and malware. Enter code to get started and protect while online surfing and downloading. McAfee.com/Activate
LikeLike
Norton.com/Setup is best antivirus available in the market. If you want to protect your system online or locally from any unforeseen events Norton is is a must have software in your PC or Mac. Activate your Norton.com/Setup to protect yourself ad your data from your system from malware and antivirus. Browse internet without any hesitation norton will take care of all malicious antiviruses floating all over internet. For any concern and help just visit website for Office.com/Setup help and key activation of Office.com/Setup You can do it by yourself if you know how to install office.com/Setup on your PC or Mac or you can call third party companies as well who can do it on your behalf.
LikeLike
Whether TDS u/s 194IC is required to be deducted if JDA was signed before 01/04/2017 and payment against such JDA is being made after 01/04/2017?
LikeLike
Tax Deducted at Source (TDS) is a means of collecting income tax in India, under the Indian Income Tax Act of 1961. Any payment covered under these provisions shall be paid after deducting a prescribed percentage. … Returns states the TDS deducted & paid to government during the Quarter TDS Interest!
LikeLike
This article post mentioned such great and useful knowledge. I'd like to add complete details on Penalty over late payment and late deduction of TDS, in this case, you can also file TDS return free for 5 active hours, check out the free e-filing through Gen TDS software here. https://articles.abilogic.com/343572/brief-details-penalty-late-payment.html
LikeLike
hello you have written such a intresting blog.it is worth of reading.keep updating and sharing with usDigit me Zen Watson
LikeLike