TDS on Sale of Property in 2026 – Section 393, Form 141, Rate & Due Date

When a buyer purchases immovable property in India from a resident seller, tax may have to be deducted at source before making payment to the seller.

From 1 April 2026, the Income-tax Act, 2025 replaced the earlier Income-tax Act, 1961 for current transactions. Accordingly, the property-TDS provisions earlier commonly known as Section 194-IA and Form 26QB are now covered under Section 393(1), Table Sl. No. 3(i) and reported through Form 141 – Schedule B.

Quick Answer

For a property transaction covered by the current law:

The Income Tax Department confirms that Form 141 is the unified challan-cum-statement under the Income-tax Act, 2025 and that Schedule B specifically covers TDS on transfer of immovable property.

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What Changed from Form 26QB to Form 141?

This is one of the most important changes for property buyers in 2026.

Property payment or credit up to 31 March 2026

Transactions where the relevant payment or credit occurred on or before 31 March 2026 continue under the old framework:

Section 194-IA → Form 26QB → Form 16B

Property payment or credit from 1 April 2026

For applicable transactions on or after 1 April 2026, the current framework is:

Section 393(1), Table Sl. No. 3(i) → Form 141 Schedule B → Form 132

The Income Tax Department specifically states that the old Forms 26QB, 26QC, 26QD and 26QE apply to events up to 31 March 2026, while transactions occurring from 1 April 2026 use the corresponding new challan-cum-TDS mechanism.

This distinction is critical because many online articles still refer only to Form 26QB.

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When Is TDS Applicable on Purchase of Property?

TDS is applicable where a buyer is responsible for paying consideration to a resident seller for transfer of qualifying immovable property and the statutory monetary threshold is reached.

The current rate is 1% of the higher of:

Sale consideration; or
Stamp duty value of the property.

The threshold is ₹50 lakh. Therefore, the transaction is covered if either the relevant consideration or stamp duty value reaches the statutory threshold.

The earlier Section 194-IA followed the same core 1% mechanism, and the substance has been carried into Section 393 of the Income-tax Act, 2025.

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Example 1 – Sale Value Higher Than Stamp Duty Value

Property purchase price: ₹75,00,000

Stamp duty value: ₹70,00,000

Higher amount: ₹75,00,000

TDS @ 1%: ₹75,000

The buyer should therefore deduct ₹75,000, subject to the applicable timing and filing requirements.

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Example 2 – Stamp Duty Value Higher Than Purchase Price

Actual consideration: ₹48,00,000

Stamp duty value: ₹52,00,000

Since the stamp duty value is higher and crosses ₹50 lakh, the transaction attracts property TDS.

TDS:

₹52,00,000 × 1% = ₹52,000

A common mistake is to look only at the agreement value. The stamp duty value must also be checked.

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TDS in Case of Joint Buyers or Joint Sellers

For determining the ₹50 lakh threshold, the transaction cannot simply be split artificially between individual buyers or sellers.

The law provides for aggregation where there is more than one transferor or transferee. This change was introduced under the earlier Act from 1 October 2024 and continues to be relevant under the current framework.

Example

Total property value: ₹80 lakh

Number of buyers: 2

Buyer share: ₹40 lakh each

Even though the individual share of each buyer is below ₹50 lakh, the overall property transaction crosses ₹50 lakh. The transaction therefore cannot escape TDS merely because ownership is divided between two buyers.

The current Form 141 Schedule B is also designed to capture details and proportionate shares of multiple buyers and sellers.

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What Amount Is Included in Property Consideration?

Property consideration is not necessarily limited to the amount described as the basic property price.

Amounts incidental to transfer can form part of consideration, including charges in the nature of:

• club membership;
• car parking;
• electricity or water facility charges;
• maintenance charges;
• advance fees; and
• similar charges incidental to transfer.

The statutory definition specifically includes these categories.

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When Should TDS Be Deducted?

The buyer should deduct TDS at the earlier of payment or credit to the seller.

Where payment is made through instalments, TDS compliance should be handled with each relevant payment once the transaction falls within the property-TDS provisions.

Form 141 specifically contains options for:

First instalment → Subsequent instalment → Last instalment

For subsequent or final instalments, the portal may require the acknowledgement number of the previous filing for the same property.

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Form 141 for Property TDS – Step-by-Step Process

For property transactions from 1 April 2026, the buyer should use Schedule B of Form 141.

Step 1 – Login

Login to the Income Tax e-Filing portal using the buyer’s PAN credentials.

Step 2 – Open e-Pay Tax

Navigate to:

e-File → e-Pay Tax

Select the Income-tax Act, 2025.

Step 3 – Create New Payment

Select:

New Payment → Form 141 – Challan-cum-Statement of Deduction of Tax under Section 393(1)

Step 4 – Select Schedule B

Choose:

Schedule B – TDS on Transfer of Immovable Property

Step 5 – Enter Property Details

Enter details such as:

Property type, property address, agreement date, registration date where available, total stamp duty value and total consideration.

Do not proportionately reduce the total property value merely because there are multiple buyers or sellers.

Step 6 – Enter Buyer and Seller Details

Enter PAN, name and proportionate share of all relevant buyers and sellers.

Step 7 – Enter Payment Details

Select whether payment is:

Lump sum or instalment.

For instalments, identify whether it is the first, subsequent or last instalment.

Step 8 – Verify TDS

Verify the amount on which tax is deductible and the TDS payable.

Step 9 – Pay and Submit Form 141

Complete payment and submission.

Save the acknowledgement and payment details for future reference.

This portal workflow is described in the Income Tax Department’s official Form 141 user manual.

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Due Date for Form 141 on Property Purchase

Form 141 must be furnished within 30 days from the end of the month in which TDS is deducted.

Example

TDS deducted: 15 September 2026

End of month: 30 September 2026

Form 141/payment deadline: 30 October 2026

Rule 218 of the Income-tax Rules, 2026 requires property TDS covered by Section 393(1), Table Sl. No. 3(i), to be paid within this 30-day period along with Form 141.

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Form 132 – TDS Certificate for Property Seller

For current transactions under the Income-tax Act, 2025, Form 132 is the relevant TDS certificate.

Form 132 replaces the earlier Forms 16B, 16C, 16D and 16E.

For property transactions, it serves as evidence that the buyer deducted and deposited TDS on behalf of the seller. The seller can use the corresponding tax credit while filing the income-tax return.

Form 132 is generally required within 15 days from the due date of the corresponding Form 141 challan-cum-statement.

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Form 141 vs Form 26QB

This table should appear high on the webpage because users continue to search for both “Form 26QB” and the newer “Form 141” terminology.

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Documents and Information Required for Form 141

Before starting the filing, keep the following ready: buyer PAN and contact details; seller PAN and residential status; property address; sale agreement; date of agreement; registration details where available; total consideration; stamp duty value; payment schedule; proportionate ownership details of each buyer and seller; and previous Form 141 acknowledgement where the filing relates to a subsequent instalment.

Accurate seller residential status is particularly important because the 1% resident-seller mechanism should not be applied blindly to an NRI seller.

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What If the Seller Is an NRI?

The 1% property-TDS rule for a resident seller should not simply be applied when the seller is a non-resident.

Payments to a non-resident seller are governed by the provisions applicable to non-residents and can involve a substantially different withholding calculation.

This distinction should be checked before making the first payment.

A further compliance simplification takes effect from 1 October 2026 for certain resident individual/HUF buyers purchasing immovable property from non-resident sellers: the Finance Act, 2026 provides for PAN-based compliance without requiring such buyers to obtain TAN, subject to the prescribed reporting mechanism.

For SEO purposes, link the words “TDS on sale of property by NRI” to your separate NRI property-TDS article rather than mixing the entire NRI law into this page.

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Correction of Form 141

Errors in a filed Form 141 should not be ignored because incorrect PAN, seller details, transaction values or deduction information can affect TDS credit.

The Income Tax Department states that correction functionality for Form 141 is available through the TRACES portal, rather than through the e-Filing portal.

Keep the original acknowledgement and transaction documentation before initiating correction.

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Consequences of Late or Incorrect Property TDS Compliance

Failure to deduct or deposit TDS on time can create additional tax exposure.

Under the Income-tax Act, 2025, interest generally applies at:

1% per month or part of a month for delay in deduction; and

1.5% per month or part of a month for delay in depositing tax after deduction.

Delayed filing of the prescribed TDS statement can also attract a fee of ₹200 per day, subject to the statutory cap, under Section 427 of the Income-tax Act, 2025.

Additional consequences or penalties may arise depending on the nature and duration of the default.

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Frequently Asked Questions on TDS on Sale of Property

Is TDS applicable if the property consideration is exactly ₹50 lakh?

Yes. The threshold applies when the prescribed value reaches ₹50 lakh; it is not limited to transactions exceeding ₹50 lakh.

Is TDS deducted only on the amount above ₹50 lakh?

No. Once the transaction falls within the provision, the 1% rate is applied to the applicable base rather than merely to the excess over ₹50 lakh.

What if the agreement value is ₹48 lakh but stamp duty value is ₹55 lakh?

TDS applies because the stamp duty value crosses the ₹50 lakh threshold. The higher value is relevant for calculating TDS.

Who deducts TDS on property purchase?

The buyer is responsible for deducting and depositing the applicable TDS.

Is Form 26QB still used in 2026?

It depends on the timing of the underlying transaction. Form 26QB continues for transactions/events governed by the old Act up to 31 March 2026. For relevant transactions from 1 April 2026, Form 141 Schedule B is the current form.

What replaced Form 16B?

Form 132 is the corresponding TDS certificate under the Income-tax Rules, 2026.

Is TAN required for property TDS from a resident seller?

The Form 141 property-TDS mechanism is PAN based.

What happens when there are two buyers and each buyer’s share is below ₹50 lakh?

The aggregate transaction value must be considered for the statutory threshold rather than examining each share in isolation.

Is TDS applicable to instalment payments?

Yes, where the property transaction is covered by the provision. Form 141 specifically accommodates first, subsequent and last instalments.

Can Form 141 be corrected?

Yes. The Income Tax Department currently provides correction through TRACES.

Does the same 1% TDS apply if the seller is an NRI?

No. A non-resident seller requires separate analysis under the provisions governing payments to non-residents.

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Practical Property TDS Checklist

Before releasing property consideration, verify the seller’s residential status → buyer and seller PAN → agreement value → stamp duty value → ₹50 lakh threshold → joint buyer/seller position → payment date → applicable TDS → Form 141 due date → Form 132 certificate → TDS credit.

This single workflow prevents most errors encountered in property-TDS transactions.

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Professional Assistance for Property TDS and Form 141

K M Gatecha & Co LLP, Chartered Accountants in Ahmedabad, assists buyers and sellers with property-TDS compliance, including applicability review, TDS calculation, Form 141 Schedule B filing, instalment-wise compliance, correction through TRACES, TDS certificate reconciliation and NRI property transaction advisory.

For transactions involving multiple buyers, multiple sellers, instalment payments, incorrect PAN details, delayed TDS or an NRI seller, the applicable provision should be determined before payment is released.