Q876. NRI buying flat in India in the name of wife. TDS paid through wife or husbands PAN

Question: Dear Sir, I am an NRI in KSA, wish to purchase a flat (cost>50L) in my wife's name who is a tax payer in India. The full amount will be paid by me from my source of income 1.Will this cause any tax burden on my wife? 2.TDS on property to be paid through my PAN or her PAN ? your early advice is highly appreciated Thanking you best regards Joseph

Answer: As an NRI giving money to your wife or purchasing flat in your wife’s name should not cause any tax burden on your wife. As far as TDS on property, this applies when property is sold. The way this works is when buying a property over Rupees 50 Lakh in value, the purchaser must deduct the applicable [1% if buying from resident] TDS from the settled purchase price and submit this amount to the tax authorities. In case the buyer fails to deduct the TDS when they bought property worth more than 50 Lakh Rupees or does not deposit the TDS amount with the tax authorities, then they would be penalized by the tax authorities. Regardless of who paid for the flat, any taxation associated to the property would be the responsibility of the registered owner of the flat. If the flat is only in the name of your wife then her PAN should be used to pay any taxes associated with the flat.