Learn about TDS on the purchase of immovable property in India under Section 194IA & Form 26QB. Understand the applicable rates, thresholds, and steps for filing.
TDS on Purchase of Immovable Property in India
Tax Deducted at Source (TDS) is a mechanism that the Indian government uses to collect tax revenue. The person who is making payment is liable to deduct and deposit TDS. In this article, we will discuss all about TDS on purchase of immovable property in India, the applicable forms, the TDS rate, and the steps to file Form 26QB.
Page Contents
- 1. Applicability of Sec 194IA, TDS Rate and Threshold limit:
- 2. Applicable Forms and Payment of TDS:
- 3. Documents are required to file Form 26QB :
- 4. Steps to fill form 26QB through Income Tax website (E-Filing Portal):
- 5. Steps to fill form 26QB through TIN NSDL Website :
- 6. Steps to generate Form 16B/TDS Certificate :
1. Applicability of Sec 194IA, TDS Rate and Threshold limit:
- Applicability: Sec 194 IA of the Income Tax Act, 1961 is applicable on any person, whether a resident or a non-resident buying any immovable property (other than agricultural land) from a resident seller.
- TDS Rate : The TDS rate for the purchase of immovable property in India is 1% of the total sale consideration. This rate applies to all types of properties, whether residential, commercial, or industrial.
Note : – If the PAN number of the seller is not available then the TDS is required to be deducted @ 20%.
- Threshold Limit : TDS is applicable on purchase of immoveable property wherein the sale consideration of the property exceeds or is equal to ₹ 50,00,000 (Rupees Fifty Lakhs).
Case studies/Examples in Tabular format for all the scenarios: –
Assumed Sale consideration is more than Stamp duty valuation of the property.
| Scenarios | Case Studies (Purchase Consideration) | ||
| Less than Rs. 50 Lakhs | Equal to Rs. 50 Lakhs | More than Rs. 50 Lakhs | |
| Purchase Consideration of immovable property | Rs.45,00,000 | Rs.50,00,000 | Rs.95,00,000 |
| Applicable TDS Rate | Not applicable | 1% | 1% |
| TDS amount to be deducted and deposited | Not applicable | Rs. 50,000 | Rs. 95000 |
2. Applicable Forms and Payment of TDS:
- Time Limit to Deposit TDS : TDS @ 1% should be deducted by the purchaser of the property on the Date of Payment or Credit to the Seller whichever is earlier. Tax so deducted should be deposited to the Government through challan-cum-statement in Form No. 26QB electronically within 30 days from the end of the month in which the deduction is made.
- Interest and Late Fee : In case of default of non-filing or late filing of Form 26QB, a penal fee of Rs. 200 per day is applicable under section 234E and applicable interest is 1% per month in case of non-deduction or 1.5% per month where TDS deducted but not deposited to Government.
- Applicable Forms: There are two forms that are applicable when it comes to TDS on the sale of immovable property in India. They are:
- Form 26QB: This is the form used for the payment of TDS on the sale of immovable property. It is known as challan-cum-statement. Form 26QB can be filed through two portals i.e. NSDL or Income Tax website. Detailed process to file this form is described further in this article. Form 26QB can be filed for each installment or Lump-sum payment.
Note:- In case of joint buyers, 26QB has to be filed by each of the buyers for proportionate share that means two 26QB forms to be filed at the same time. And in case of Joint seller and joint buyer, four 26QB forms has to be filed.
-
- Form 16B: This is the TDS certificate that is issued by the buyer to the seller after the TDS payment is made. This certificate can be generated through Traces Portal. Steps given below in this article.
3. Documents are required to file Form 26QB :
User should be ready with the following information while filling the form 26QB:-
- Seller Details ( PAN card copy, Aadhaar card copy, Contact details)
- Buyer Details ( PAN card copy, Aadhaar card copy, Contact details)
- Sale Deed/Agreement to Sell for property details
- Circle value (Stamp Duty valuation) of the property
- Buyer’s :-
-
- E-filing Portal ID & Password
- Traces Portal (Taxpayer ID & Password)
- Payment Details (In case of Installments)
- Date of Payment, Amount paid, Mode for payment.
4. Steps to fill form 26QB through Income Tax website (E-Filing Portal):
Note :- This method to file Form 26QB is made available by Income Tax department wef year 2022. And it is the easiest and convenient method to deposit TDS. So if you are choosing this method to file Form 26QB then you can skip the Point No. V of this article.
The following are the steps to file Form 26QB for the payment of TDS on the sale of immovable property in India through Income Tax website (E-Filing Portal):
- Log in to the e-Filing portal with Buyer’s User ID and Password using the link (https://eportal.incometax.gov.in/iec/foservices/#/login)
- On the Dashboard, click e-File> e-Pay Tax. You will be navigated to the e-Pay Tax. On the e-Pay Tax page, click the New Payment option to initiate the online tax payment.
- Search for form 26QB (TDS on sale of property) and click on proceed
- Now choose residential status of seller
- Add Buyer Details:-
-
- Verify the details of buyer which are auto-fetched from the Profile section (Note- If you want to update these details then edit in the Profile section, after update, fill the form 26QB)
- Click on yes if there is more than one purchaser of property (Joint Buyers), otherwise click No and click continue (Note : Please fill another Form 26QB for co-buyer share)
- Add Seller Details :-
- Now fill the details of seller of property (Pan No. and aadhaar no. of seller, Address details, contact details)
- Click on yes if there is more than one Seller of property (Joint Seller), otherwise click No and click continue (Note : Please fill another Form 26QB for co-seller share)
- Add Property transferred Details :-
- Now Fill the details of the property (Type, Address of property)
- Fill Date of agreement, Date of payment , Date of deduction and total value of the consideration (Property value)
- Now choose payment type. If payment is on installment basis, then select yes and again yes if it is last installment and if payment is made on lump-sum basis then last instalment option will be disabled automatically.
- Choose yes or no whether stamp duty value is higher than sale consideration (Normally it is always No)
- Fill amount paid/credited currently & stamp duty value of the property
- And then it will auto-calculate TDS amount
- Click Continue
- Add Payment Details :-
- In the Select Payment Mode page, there are various options, it is suggested to select Payment Gateway mode and click Continue. In the Preview and Make Payment page, verify the details and tax break up details and click Pay Now.
- Read and Select the T&Cs and Click Submit to Bank. (You will be redirected to the website of Payment Gateway where you can login or enter Net Banking/ Debit / Credit Card / UPI details and make the payment).
- After successful payment, you will receive a confirmation e-Mail and an SMS on the e-Mail ID and Mobile number registered with the e-Filing portal. Once the payment is successful, details of payment and Challan Receipt are available under Payment History Tab on the e-Pay Tax page.
- After this step, payment of TDS is successful.
5. Steps to fill form 26QB through TIN NSDL Website :
Note :- This method to file Form 26QB became obsolete from year 2022. Now we can file Form 26QB through Income Tax website as described above in Point No. III above.
The following are the steps to file Form 26QB for the payment of TDS on the sale of immovable property in India through TIN NSDL Website:
- Go to TIN Protean website (https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp).
- Scroll down and select “TDS on Property (Form 26QB)” and click on Proceed button.
- Fill the complete form as applicable: –
- Fill PAN Details of Transferee (Buyer) and Transferor (Seller)
- Fill Complete Address of Transferor & Transferee
- Fill Details of Property purchased like location of property etc.
- Fill Amount paid/credited & tax deposit details
- Submit the duly filled form to proceed. A confirmation screen appears. After confirming, a screen appears showing two buttons as “Print Form 26QB” and “Submit to the bank”. A unique acknowledgement number is also displayed on the screen. It is advisable to save this acknowledgment number for future use. You can use this acknowledgement number to download Form 16B, which is the TDS certificate that needs to be issued to the seller.
- Click on “Print Form 26QB” to print the form. Then click on “Submit to the bank” to make the required payment online. You will be directed to the payment gateway where you can make the TDS payment using any of the available modes of payment, such as credit card, debit card, or net banking.
- On successful payment a challan counterfoil will be displayed containing CIN, payment details and bank name through which e-payment has been made. This counterfoil is proof of payment being made.
- After this step, payment of TDS is successful.
6. Steps to generate Form 16B/TDS Certificate :
Deductor has to furnish Form 16B to the payee within a period of 15 of filing Form 26QB.
(Note :- Proceed to TRACES portal( www.tdscpc.gov.in) after 4-5 days to download Form 16B.)
Steps to Download Form 16B :
- If you have deposited TDS on immovable property for the first time then you have to Register yourself as a Taxpayer on Traces portal (https://www.tdscpc.gov.in/app/tapreg1.xhtml)
- And If have user Id and password for this portal already, then login on TRACES portal as taxpayer using your PAN. (https://www.tdscpc.gov.in/app/login.xhtml)
- Select “Form 16B (For Buyer)” under “Downloads” menu.
- Enter the details pertaining to the property transaction for which Form 16B is to be requested. Enter the Assessment Year, Acknowledgment Number of Form 26QB, PAN of Seller and click on “Proceed”.
- A confirmation screen will appear. Click on “Submit Request” to proceed.
- A success message on submission of download request will appear. Please note the request number to search for the download request.
- Sometimes it take around 30 minutes to process the request
- Then again login the Traces portal and Click on “Requested Downloads” to download the requested files.
- Search for the request with request number. Select the request row and click on “HTTP download” button.
- You can extract Form 16B pdf and share this with the Seller of the property for proof of TDS payment.
Conclusion:
TDS on the sale of immovable property in India is an important mechanism for the government to collect tax revenue. By deducting a portion of the payment made to the seller, the government ensures that the tax is paid at the time of the transaction. Form 26QB and Form 16B are the two forms that are applicable for TDS on the sale of immovable property in India. The TDS rate is 1% of the total sale consideration. By following the steps outlined above, you can file Form 26QB and make the TDS payment easily and efficiently.
Author Bio
I sold a plot in Dec 2022 and the total sale proceeds (Rs.25.00 Lakh0, was disposed of in following manner
(i) Entire sale proceeds excepting Rs.1,57,913 was given to the builder (for purchase of a flat jointly with my son) in March 2023.
(ii) Rs. 1.57,913.00 was deposited as TDS on 31.July 2023 which is showing in Form AS 26 for the AY 2024 25.
I had filed ITR 2 for FY 2022 23 and reported the sale and capital gain arising out of the sale of the plot and payment made to the builder.
Since the TDS (as per II) above, was deposited on July 31, 2023, the same is showing in Form AS 26 for FY 2023 24
I have a total income of a few thousands only from interest on SB account and Dividends on shares, which ITR Form I should use to file IT Return for AY2024-25, and where to show the TDS amount in it.
Thanks
B K Sinha
Dear Madam, I have encountered a problem while making corrections in 26QB
While submitting the details for confirmation, a note appeared “ major head does not correspond to the category of PAN of buyer” and i got stuck with the process
(By default major head 0020 and minor head 800)
There are 2 buyers, 2 sellers, for property value of 1.75 cr, we have paid 1st installment and mentioned total property value as 1.75cr in all 4 forms. While paying last installment, it is asking to fill column stamp duty value (proportionate share) what value should be filled ? 1.75 cr or 87.5 lacs each.
Dear Madam
I purchased a property for 60lacs from 2 sellers having equal share. so now to fill 26qb for each buyer seller combination what should be the amt to be specified in Total Value of Sale consideration. is it 60lacs or 30lacs.
please clarify the above.
thank you.
Mention Rs. 30 lakh in each Form 26QB. Because to check over-all purchase consideration, we have to combine impact of all 26QB forms.
Hope it resolved your query.
Me and my wife purchase a property in joint Ownership. While paying TDS , I have paid all the tds amount and property got registered.Now how can I rectify this and fill tds on behalf of wife . Is there any chances that my wife could get IT notice.Please clarify.
You can submit Form 26QB correction request through Traces portal under Statement/Forms Tab. However, if you don’t opt for correction then you can submit clarification in response to notice (if received on the basis of AIS information) that all applicable taxes deposited in your name.
In case of 2 joint holders and 1 seller, while paying last instalment,
website form shows error in red at stamp duty value of property – “Please enter proportionate share of stamp duty value.”
details below :
property consideration value = Rs 3.4cr
stamp duty value as per MTR challan of agreement = Rs 2.3 cr
prev installments = Rs 3.14 cr
Current installment payment = Rs 26 lacs
pls help thanks
I purchased a property in pune recently. Agreement Value is INR 5120001. Stamp Duty Rate – 7% of agreement i.e. 385000. What should I fill in below fields of From 26QB
1. Total Consideration Value
2. Amount paid/credited currently (B)
3. Total stamp duty value of the property (C)
Sir,
Property i purchased is Rs.1.25 crores net value and ~1.31 crores gross i.e., including GST. Now what should be considered as my property value while filing 26QB? Seller said 1% TDS should be on net value. So, do I need to consider property value as Rs.1.25 crores only?
Hello Dinesh sir,
Please suggest on a query..
If there are Four 4 join buyers(Husband – applicant , Wife, son and daughter-in-law – Co-applicant) and one seller.
husband has paid booking amount of the property price to seller(1st installment) and 2nd installment paid by husband & wife . and 3rd Instilment is disbursement by bank please tell how to file 26QB.
Then does husband needs to file 26QB on the amount he has paid now and 2nd installment paid by husband & wife need to file 26QB on the amount they paid. Further 3rd Instilment is disbursement by bank is to file 26QB by four co- owner.
Please shed some light with your suggestion on filling 26QB in this scenario
Dear Sir / Madam ,
Please suggest on a query..
If there are Four 4 join buyers(Husband – applicant , Wife, son and daughter-in-law – Co-applicant) and one seller.
husband has paid booking amount of the property price to seller(1st installment) and 2nd installment paid by husband & wife . and 3rd Instilment is disbursement by bank please tell how to file 26QB.
Then does husband needs to file 26QB on the amount he has paid now and 2nd installment paid by husband & wife need to file 26QB on the amount they paid. Further 3rd Instilment is disbursement by bank is to file 26QB by four co- owner.
Please shed some light with your suggestion on filling 26QB in this scenario
Hi, if installment amount is 10 lakh and TDS is 10 k and there are two buyers. does that mean we need to file two 26qb form with each consideration amount of 50 lakh and TDS rs. 5 k?
Dear Madam, Me and my wife have equal shares in an apartment with total property cost 1.4cr and paid 70lac. Do I need to pay the TDS from both PAN Card by logging in to respective ITR filing login or Shall I login and submit 26QB for both me and my wife? Also what will be the total value of Consideration & Amount paid/credited currently.
without aadhar card generate form 26QB
Dear CA pinky Mam,
is it necessary that 26 QB filed for each installment for both Co buyers?
In my case for 1st installment, I paid the complete TDS for 1st installment through my PAN. Is it ok to adjust the TDS in the 2nd installment so that share becomes equal for both co buyers? I.e the amount paid by the co buyer will be increased in the 2nd installment so that share of contribution becomes equal when adding both the installments. So, in total 3 nos. of 26QB’s will be filled.
please reply.
Hello Ma’am,
Thank you for the great article!
My doubt –
Case = 2 Buyers and 2 Sellers (all equal proportion)
Total Property price = 1.10 cr
All payment is made lumpsum.
While filing the four separate 26QB forms, can you please tell me what to fill in all three fields in each form –
1. Total Consideration Value?
[1.10cr? or 55L? or 27.5L?]
2. Amount Paid/Credited?
[27.5L in each form right?]
3. Stamp Duty value?
[1.10cr? or 55L? or 27.5L?]
It would be really nice of you if you could reply and answer my query! 🙂
Thanks & Regards,
Akshdeep Singh Anand
Hello Ms. Jain,
Thanks for your efforts for getting this very informative article for people like us.
I invested in a property with joint ownership with my wife and have paid 2 installments till date. I made mistake and deposited the TDS under my name only. I have to deposit another installment now and realized after reading your article that I should have done 2 different TDS deposits. What should be done now? Please advice.
In case of joint buyers, husband and wife, where payment will be made only by the husband, whether in this case also, equal share to be shown when there is no written agreement
Dear Pinky Jain,
I have a doubt about the major head for 26QB. In my previous 26QB where the builder vendor was filing, they used 21, but after the recent changes when I was trying to do it from the income tax site, the major head changes to 20 after entering the seller’s pan.
Is this I need to be worried about?
In case of 2 Buyers (Husband & Wife), does each Buyer have to pay 1% share from his/her Pan Login Account separately. No one has clarified this.
Hi
we have purchased a property with two buyers and total value of the property is 92 lakhs , payment is in installments till now we have paid 50 percent of the amount and filled the TDS by my self only but I have checked the box for multiple buyers , now I want to file the remaining amount of TDS on 2nd buyers name ( wife ) need to know as 2nd buyer what amount should be mentioned like total value of the property , Amount paid in previous installments will it be the same which I have paid till now on first buyers form or on 2nd buyer it will start from what’s paid now when filling on her name
Hi,
I have purchased a property of amt 61L and its a joint agreement for me and for my wife, I have came to know that I have to fill 26qs one for myself and one for my wife. My first installation amount is around 5L, ie 5k TDS(1%), while filling 26qs should myself and my wife should have to pay 1% TDS means 10K(5k+5k)?
If you have paid Rs. 5 Lakh only, then you have to distribute the amount in both 26QB forms for you and your wife and TDS will be applicable @1% for the respective share.
Eg. Rs. 250000 @1%= 2500 for you and Rs. 250000 @1% = 2500 for your wife.
Dear CA. Pinky Jain,
I have a case where there are 2 buyers and 2 sellers and the sale consideration is Rs. 1,00,00,000/-.
As per my understanding the provisions of section 194IA should not be applicable as one buyer is paying consideration of Rs. 25,00,000/- to one seller.
Please suggest.
Thanks and regards.
Dear Sir,
TDS is applicable u/s 194IA in your case as the total consideration of immovable property is Rs. 1 crore which exceeds the threshold limit of Rs. 50,00,000. Please note that the threshold limit is for each property, not for each buyer.
And you have to file four 26QB forms. For each buyer, two 26QB forms are to be filed.
I am filling Form 26QB, FOR TWO BUYER. Value of property is 1.3 cr. in new 26QB THEIR ARE THREE BOX, Total Value of consideration, amount paid credited and stamp duty value. I have divided two share in amount paid credited and stamp duty as per shares.
My question is what value are put in Total value of cosideration (property value) here also it can be divided like in my case 65lakh each or we need to put full value 1.3cr
Hi,
Just checking what value did you put in Total Consideration for Joint property in your case. I too have the similar scenario.
Dear Sir,
In the total consideration of the property (Property value) box, you have to fill in the proportionate share. In your case, you have to fill Rs. 65 Lakh.
Let me explain the reason, This form differentiates two boxes, total consideration and amount paid/credited currently because sometimes buyer deposit TDS on installments basis. In such cases, the total consideration value remains the same in all 26QB forms, but the amount paid/credited currently gets changed every time.
We are joint buyers, paying the builder in installments for under-construction property. We need to deduct TDS on every installment. So in the Total Consideration value (Property value), we will enter the enter proportionate share?
i am also getting same error- what to do?
If their is more than one buyer than in Form 26qb in total value of consideration(property value) can be divide in to his share of we need to write full property value.
Dear Sir,
In the case of joint buyers, you have to fill in the proportionate share in the total consideration of the property (Property value) box.
AT THE TIME OF DOWNLOADING 16B , THERE IS A COLUMN FOR ACKNOWLEDGEMRNT NO. WHAT IS IT AND FROM WHERE CAN WE GET IT?
Dear Sir,
When you submit Form 26QB, it generates a unique acknowledgment no. of the form. You have to use that acknowledgment no. to download Form 16B.
If you have not saved the ack. no., then you may check it on your filing portal under E-file> E-pay tax > Payment history tab.
Sir, the value of property is 5500000. Me and my wife are the buyers. I need to fill form 26qb for both me and my wife. Should i split the money equally here ? Planning to put 2750000 in Amount paid/credited currently (B) and what should be put in Total stamp duty value of the property (C) ?
Dear Sir,
In case of joint buyers, you have to fill two 26QB forms but there is no condition to put equal amount. The joint buyers can decide their share as per mutual consent and as per agreement. If the agreement is silent on the proportionate share, then it is suggested to show equal share.
And you have to fill the proportionate share (can be taken equal) of circle value/stamp duty valuation of property in each form. For the stamp duty valuation of your property, you can ask from deed writer/advocate to check the circle rate of the respective property.
Dear Pinky Jain,
I found this article very useful and comprehensive.
The first method “fill form 26QB through Income Tax website (E-Filing Portal)” is the easiest and convenient method to deposit TDS. I was always filling 26QB through TIN NSDL Website which use to consume more time.
I have a small clarification under the Property Transferred Details section
“Total amount paid/
credited in previous
installments, if any”
Question: Should we indicate total Sum of all the previous installments {or) its just the amount paid in previous installment?
In my case, I just indicated the amount paid in the previous installment (which is not total sum) is there any issue (hope not)
Appreciate your reply on this.
Thank you.
Dear Sir,
You have to mention “Total Sum of all the previous installments” as the purpose is to link amount of all installments for a single property.
You can mention correct amount in the 26QB form for next installment, if it was not the last installment.
Dear Madam,
I have made a payment of TDS of Rs. 1,30,000/- under section 194IA as on 27th March, 2023 for which my account has been debited but the challan has not been Generated till now on Income Tax Portal.
so please suggest what can i do.
Thanks
Dear Sir,
Sometimes due to technical glitch on the portal challan may not be generated at the time of payment. But you can download the challan by following the below steps :-
Step 1: Login to your Income tax portal.
Step 2: On the dashboard, click e-File > e-Pay tax.
Step:3 Then in the Payment history tab you can view the paid challan details and click on the icon(:) under action tab and then click on “Download receipt”. Challan will be generated in the pdf format.
In case you do not find the challan details on you efiling portal, then you can contact the customer care helpline of the Income Tax department or you may submit a grievance regarding the same on E-Filing portal for resolution of the issue.
Thank you