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What is TDS?

TDS which stands for tax deducted at source has been laid down by the Income Tax Act. Under this Act, if any Company or person makes a payment, then they have to deduct tax at source if their payment exceeds a certain threshold limit, which has been specified by the department. The TDS has to be deducted by keeping the prices in mind which has been prescribed by the Tax Department. 


There are a deductor and a deductee in the pROCess. A deductor is a person or Company which makes the payment after deducting TDS, on the other hand, a deductee is that person or firm which accepts or receives the payment. The deductor has to deduct the TDS and submit it to the government, before making any form of payment. The TDS is linked to the PAN and therefore can be deduced in any form, either cash, cheque, credits or any other form of payment. The following are the types of payments in which the TDS has to be deducted:


Interest payments by Banks

Commission payments

Rent payments

Consultation fees

Professional fees


What is TDS Return (Property Sale)

The TDS return for property ale has been mentioned in Section 194-IA of the Income Tax Act. The TDS Return for property sale is applicable when a buyer buys immovable property such as a building or part of a building or any land other than agricultural land which is more than Rs. 50 lacs. If done so, the person has to deduct the TDS at the time of paying to the seller. This is mandatory for everyone from 1 June 2013.


If the immovable property is either under construction or is fully built, and the value ranges up to 50 lacs or more, then the person or the Company has to pay a withholding tax of 1% from the sale consideration payable to the seller of the property. This TDS is deducted at the time of payment or in case of, if the payment is made in instalments then TDS has to be paid at every instalment. 


Payment pROCedure

In order to make an online payment of tax, this could be done via the e-tax payment option. In this, the buyer has to fill an online form, 26QB. For this method, the following are required:

PAN details of the buyer and seller

Details of the property

The total consideration which is payable

 All the payment details which have been made.

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FAQ - Frequently asked questions

I have bought a property for residential purpose. Do I also need to deduct TDS? 

TDS has to be deducted by every buyer on the purchase of an immovable property being building/land other than agriculture land if the purchase value exceeds Rs. 50 lakh. TDS is to be deducted from the whole amount to be paid.

I am a property buyer. What should I do if I don’t have the PAN of the seller(s)?

PAN of the seller is mandatory for deducting TDS and filing Form 26QB. It is the buyer’s responsibility to acquire the PAN from the seller before effecting the transaction. Neither the buyer nor the seller is required to procure the TAN but both parties need to givce their PAN only.

How many forms has to be filled if someone buys property which was jointly owned by my two others? 

The Form 26QB challan has to be filled by each buyer for every unique buyer-seller combination for their respective share.

When do I need to deduct TDS?

From June 1st 2013, when a buyer (Indian Resident) buys immovable property costing more than Rs 50 lakhs, he has to deduct TDS when he pays the seller. So, there is a need to deduct TDS.

What is an immovable property?

An immovable property is either a building or part of a building or any land other than agricultural land which cannot be moved.

What is the interest and penalty for non-filing or late filing of Form 26QB?

TDS has to be deducted at the time of making the payment, whether in lump sum or instalments. TDS has to be deducted and deposited within 7 days of the next month in which payment is made

I have 6 Challans to submit. What will be the value of the package?

We cover up to 4 Challans in our package. For every additional Challan, the service charge shall be Rs. 499 plus service tax.