How to file TDS on the Sale of Property?

TDS stands for Tax Deducted at Source. At the time of purchasing property, the buyer is liable to deduct TDS from buying price and pay TDS to Income Tax Department.

Who Pays TDS:

As per the government regulation, the buyer responsible to deduct the TDS and not the seller. If the buyer does not discharge this duty of TDS payment, buyer can be penalized for non-payment.

TDS rate:

1% TDS is applicable if property purchase value or guidance value is more than Rs. 50 Lakhs, whichever is higher. TDS on purchase of property is applicable for residential property, commercial property and land. But this does not include agricultural land.

TDS for NRIs is different because the government deducts capital gains and TDS for the NRIs. Below is the TDS rate for NRIs

When to pay TDS:

Buyer need to pay the TDS on or before registering the sale deed, as the registering officer verifies the TDS challan before proceeding sale deed registration, also It is important to mention TDS Challan number in sale deed before registration.

Details required to pay TDS:

TDS payment on purchase of property, the buyer does not require a TAN. When filling the Form 26QB, you will need to submit the names, addresses, PAN, phone number and email id of both the buyer and the seller.

You will need to submit the complete address of schedule property (to be purchased), the date of the agreement, the date of the payment, and the buying price. You can make the TDS payment online via net banking or physically at the bank. If there is more than one buyer or seller, you need to furnish the details of each party in Form 26QB

Here is the step-by-step procedure to pay TDS Online:

Step 1: Open the website e-Payment for TIN The page looks like below image

Scroll down a bit and you can find “TDS on Property (Form 26QB)”. Click on the “proceed” button. Refer to below image in circle

Step 2: The FORM 26QB has four pages, they are

• Taxpayer Info
• Address
• Property Details
• Payment Info

Let us start with Taxpayer info, the page looks like below image

Let me explain in detail to fill the above form,

• Tax Applicable: select “(0021) Income Tax (Other than Companies)”
• Financial Year: is default, no entry is required
• Assessment Year: is default, no entry is required
• Type of Payment: default selects (800) TDS on Sale of Property, no entry is required
• Status of the Payee/Seller/Transferor: select Resident if seller resides in India or select Non-Resident if seller resides abroad
• Enter Buyer and Seller PAN Number

Below is the image of filled FORM

Click on “Next” at bottom right corner of page.

Step 3: The Address page looks like below image, Fill in the address, email and phone number of buyer and seller

Click on “Next” at bottom right corner of page

Step 4: In Property Details, enter the details of property to be purchased. Below is the image of FORM

Below is the explanation to fill above FORM (Property details)

• Type of Property: Select either Land or building from dropdown list (Building includes commercial, residential building and apartment)
• Type of Property: Enter your house name or apartment name, followed by flat number, village name, city, Pincode
• Date of Agreement/Booking: Select the date of sale agreement signed with seller. If sale agreement is not signed with seller, mention the date of 1st advance made to seller
• Total Value of Consideration (Property Value): Enter your buying price
• Stamp Duty Value For Property: Enter the value of stamp duty you pay to register the sale deed. In Karnataka, the stamp duty is 5.1% of buying price or guidance value, whichever is higher

For example: the buying price is Rs. 82 Lakh, the stamp duty is 5.1% of 82 lakh, that is Rs, 4,18,200/-

• Payment Type: Select “Limpsum” from dropdown list
• Date of Payment/Credit (Date of Payment to the Transferor/Seller) : Select today’s date from dropdown list
• Date of Tax Deduction: Select today’s date from dropdown list
• AMOUNT PAID/CREDITED: Select your buying price in dropdown list

TAX DEPOSIT DETAILS

• Total Amount Paid/Credited: Enter your buying price
• Rate of TDS (in %): 1 appeal default, entry is not require
• Basic Tax (TDS Amount to be paid): Enter 1% of your buying price (For example: Buying price Rs. 82 Lakh * 1% = 82,000). Enter Rs. 82,000
• Interest: No entry required
• Fee : No entry required

Below is the image of filled form

Click on “Next” at bottom right corner of page.

Step 5: In Payment Info,

• Mode of Payment: If you want to pay online select “e-tax payment immediately”

You have option to pay by Net-banking or Debit card. Hence select your payment option and proceed with payment. The payment screen looks like below image

Enter the Captcha code and click on “Proceed” button and complete the payment

Once the payment is complete, the page directs to download the TDS challan. The TDS challan looks like below image

This completes the procedure to pay TDS for property purchase.

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We provide assistance to generate TDS challan. To opt for our service, please Whatsapp to +91-97424 79020.

Thank you for reading…