If you're buying a house, expect a call from the taxman. The income tax (I-T) department has decided to toothcomb property deals that could throw light on irregularities or tax evasion all over the country. Both individual and corporate deals are set to come under the taxman's lens.
“We'll review all property deals to find out whether any black money has changed hands and detect tax evasion, and action will be taken in appropriate cases,“ central board of direct taxes (CBDT) chairman Sudhir Chandra told mediapersons here on Monday.
This will be the first step of its kind. Though the I-T department has been building a tax information network (TIN) to examine financial dealings, it has thus far not zeroed in on a deal-by-deal basis.
The department had scoured transactions and accounts involving all major real estate players or property dealers in Delhi, but no individual transaction had been reviewed, Chandra said.
“Henceforth, property deals, whether by an individual or by a real estate company, will be reviewed,“ he said, adding that the department will frame rules to enable action by its officers.
Thousands of crores of rupees are said to be evaded every year in property deals because buyers and sellers disclose only a part of the transactions while the remainder changes hands in all-cash dealings with no proper records kept or disclosed.
Such deals help sellers evade both income tax and registration duties.