Microlesson · 5-min read

Section 194LA — Compensation on Compulsory Acquisition

# Section 194LA — TDS on Compensation for Compulsory Acquisition of Immovable Property

## Who deducts?

Any person paying compensation (or enhanced compensation) on compulsory acquisition of immovable property (other than rural agricultural land).

## When?

At the time of payment.

## Threshold

Aggregate payment > ₹5,00,000 in a financial year.

## Rate

10%.

## Notes

Worked example

### Example 1

Example: Govt. pays ₹15,00,000 compensation to landowner for acquiring urban land. TDS = 10% × ₹15,00,000 = ₹1,50,000.

Deducting TDS where the acquisition is under RFCTLARR Act, 2013 (compensation is exempt and outside Sec 194LA).

Reference: 194LA

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