Is TDS applicable on agricultural land?

No - Section 194-IA expressly excludes rural agricultural land. But agricultural land in urban / specified municipal limits is still a 'capital asset' and TDS applies.

Can the seller refund excess TDS via their ITR?

Yes. Excess TDS (especially the 20% on NRI sellers when actual gains tax is lower) is refunded to the seller via their ITR. The seller can also avoid excess upfront via a Lower-Deduction Certificate (Form 13).

Who pays the TDS deduction - buyer or seller?

Buyer deducts and deposits. Practically, the seller bears the economic cost (it reduces their proceeds). The legal liability for non-compliance stays with the buyer.

TDS on Property Purchase

Deduct TDS on property - Section 194-IA or 195, the right route.

When a buyer pays Rs 50 lakh or more for a property, Section 194-IA mandates 1% TDS deducted from the seller's payment - filed via Form 26QB. If the seller is an NRI, Section 195 kicks in at 20%-30% (much higher), with Form 27Q. Get the form, rate and form-13 route right.

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Qualified CA / CS partnersSame-day filingBest for: Property buyers (resident sellers @ 1%, NRI sellers @ 20-30%)

Starting at

₹1,999 onwards

TDS on Property

Property buyers (resident sellers @ 1%, NRI sellers @ 20-30%)

Form 26QB (resident sellers) - 1%

Form 27Q (NRI sellers) - 20% / 30%

Form 16B / 16A buyer-side certificates

Lower-deduction certificate (LDC) assist

Timeline

Same-day filing

What it is

TDS on Property, explained in plain English.

Sections 194-IA and 195 of the Income Tax Act make the buyer responsible for deducting TDS while paying the seller for immovable property (excluding agricultural land). The buyer (not the seller) is the one who must register on the TRACES portal, file the form, deposit the tax and issue the certificate to the seller. Default exposes the buyer to penalty + interest + disallowance of property in cost.

TL;DR

Buyer deducts. Resident seller > Rs 50 lakh = 1% via 26QB. NRI seller = 20-30% via 27Q. Lower-deduction certificate brings the NRI rate down to actual gains tax.

Key terms

The vocabulary you'll see on the portal.

Section 194-IA

1% TDS on property purchase from a resident if consideration / SDV >= Rs 50 lakh.

Section 195

TDS on payments to non-residents; rate based on income head (20%/30% on LTCG / STCG).

Form 26QB

Challan-cum-statement for 194-IA TDS. Filed within 30 days of the month of deduction.

Form 27Q

Quarterly TDS return for non-resident payments under Section 195.

LDC (Form 13)

Lower-deduction certificate the NRI seller can obtain to reduce TDS to actual capital gains tax.

Routes & scenarios

Match the situation to the right fix.

Resident seller (Section 194-IA)

1% on the higher of consideration or stamp-duty value. Single filing via Form 26QB.

Threshold Rs 50 lakh (per seller / per buyer combo)
1% deducted on every instalment paid
26QB filed within 30 days of month-end
Form 16B downloaded from TRACES

NRI seller (Section 195)

20% LTCG (24 months+ holding) or 30% slab on STCG. No Rs 50 lakh threshold - first rupee.

27Q quarterly return + TAN required
Form 16A issued to seller
Surcharge + cess applicable
Lower-rate certificate via Form 13 recommended

Joint owners / multiple sellers

Apportion consideration share-wise; each owner = separate 26QB / 27Q row.

Each buyer-seller pair = separate form
Threshold checked per seller (Rs 50 lakh each)
PAN of every party mandatory
Joint loan EMI tracking

The process

TDS on Property - from kickoff to confirmation.

Classify

Resident or NRI seller? Single or joint owners? Consideration vs stamp-duty value mapped.

TAN / 26QB setup

26QB needs only buyer's PAN. 27Q requires the buyer to obtain a TAN - we apply same day.

Deduct + deposit

TDS deducted on each instalment; challan deposited; quarterly 27Q or per-payment 26QB filed.

Certificate

Form 16B (26QB) / 16A (27Q) downloaded from TRACES; provided to seller for their ITR.

Documents required

What we'll need from you.

Upload via our secure portal. We pre-check every scan before filing - cuts portal rejections by ~90%.

Buyer + seller PAN, Aadhaar, address

Sale agreement + payment schedule

Stamp-duty valuation / circle-rate certificate

Bank challans for each payment

Seller's TRC + LDC (if NRI claiming DTAA / lower rate)

TAN application docs (for NRI seller cases)

TDS on Property FAQ

Common questions, answered by partners.

Still unsure if TDS on Property is right for your case? Book a free 20-minute consult - a senior CA / CS will walk you through your specifics.

Still have questions?

Book a free 20-minute consult with a senior partner - we'll walk through your case and outline next steps.

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Deduct at the next instalment (or immediately if all paid) plus 1% interest/month under Section 201(1A). Also 1% interest/month for late deposit and Rs 200/day under Section 234E for late filing of 26QB / 27Q.

Ready when you are

Let's get your TDS on Property sorted this week.

A senior CA / CS will get on a call with you, confirm scope and start the work - usually within 24 hours.

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