All Property Related Transactions Over Rs 20,000 To Be Reported To I-T

In a recent move that would further help clean up the Real Estate sector, the Income Tax (I-T) Department has made it mandatory for the auditors to give details of property-related transactions of their clients exceeding Rs 20,000 from the financial year 2016-17 (FY17). This will be done in a specific format where the mode of the payment will also have to be mentioned amounted to enhanced reporting of transactions. Auditors will have to mention whether the payment is through account payee or bearer cheque or electronic system. Earlier, auditor reports mentioned only details pertaining to loans, and repayment exceeding Rs 20,000, and the disclosure requirement was to report whether or not transactions are through account payee cheque or bank draft.

To mandate this, the I-T department has revised the Form 3CD for tax audit report under Section 44AB of the Income Tax Act. The new rules come into effect from July 19 this year and will apply for the assessment year 2017-18.

It is worth mentioning here individuals earning over Rs 50 lakh annually have to get their accounts audited. Companies which have an annual turnover of over Rs 3 core must also get their books audited.

A lot is going on within India's real estate sector these days.  Apart from the many big steps that the government has taken to usher in transparency into a sector that had come to be widely perceived as an arena where shady dealings ruled, several small measures are also being implemented to cure property markets of all their ills. While we may term the introduction of the Real Estate (Regulation & Development) Act, 2016, the Goods and Services Tax regime, the Benami Transactions (Prohibition) Amendment Act, 2016, and demonetisation as the big steps, small changes are being made in the property-related transaction methods to simplify things. More importantly, efforts are being made to make things more transparent.

While we may term the introduction of the Real Estate (Regulation & Development) Act, 2016, the Goods and Services Tax regime, the Benami Transactions (Prohibition) Amendment Act, 2016, and demonetisation as the big steps, small changes are being made in the property-related transaction methods to simplify things. More importantly, efforts are being made to make things more transparent.

Also Read: Property Fraud: Know The Ways In Which You May Be Cheated