Current TDS Rule on Purchase of Immovable Property
Where a buyer is responsible for paying consideration to a resident seller for transfer of immovable property other than agricultural land covered by the statutory exclusion, tax is generally deducted at 1% at the time of credit or payment, whichever is earlier.
The 1% is calculated on the higher of the sale consideration and the stamp duty value. The property-TDS provision applies when the consideration or stamp duty value reaches the statutory threshold of ₹50 lakh.
For the threshold test, where there is more than one buyer or seller, the consideration is considered on an aggregate basis as provided by law. Incidental transfer charges such as club membership, car parking, electricity or water facility, maintenance, advance fee and similar charges can form part of the consideration where the statutory definition applies.
Form 141 vs Form 26QB: Which Form Applies?
| Transaction timing | Applicable framework | Statement / payment form |
|---|---|---|
| Relevant credit/payment event on or before 31 March 2026 | Income-tax Act, 1961, including section 194-IA and transition provisions | Form 26QB, where applicable |
| Relevant credit/payment event on or after 1 April 2026 | Income-tax Act, 2025, section 393(1), Table Sl. No. 3(i) | Form 141, Schedule B |
If your transaction spans the transition date, use the law applicable to the particular deduction event and verify the filing path on the Income Tax e-Filing portal.
How to Calculate TDS on Property
Use the higher of the agreed consideration and the applicable stamp duty value as the starting base, then apply the prescribed 1% rate where the threshold condition is satisfied.
Example: if the sale consideration is ₹72 lakh and the stamp duty value is ₹76 lakh, the relevant base is ₹76 lakh and 1% TDS would ordinarily be ₹76,000, subject to the facts of the transaction and other applicable provisions.
Where payment is made in instalments, TDS is generally deducted when the amount is credited or paid, whichever occurs first. Keep records of the agreement, payment dates, buyer and seller PAN details, stamp duty value and tax payment acknowledgements.
How to File Form 141 and Pay Property TDS Online
For deductions governed by the Income-tax Act, 2025, the Income Tax Department provides Form 141 through the e-Filing portal.
- Open the official Income Tax e-Filing portal.
Income Tax e-Filing Portal - Log in with the buyer's PAN credentials. Follow the portal path for e-Pay Tax and select the Income-tax Act, 2025.
- Choose Form 141. Select the schedule for transfer of immovable property and enter the required deductor, seller and property particulars.
- Enter transaction details carefully. Keep the seller's valid PAN, property address, agreement details, payment details, consideration and stamp duty value ready.
- Verify the tax amount. Review the 1% deduction and any interest or fee shown as applicable before payment.
- Make the payment through the available online payment mode. Save the challan / payment acknowledgement for your records.
- Complete Form 141 within the due date. The deducted amount is to be paid and the challan-cum-statement furnished within 30 days from the end of the month in which tax is deducted.
Resident Seller vs Non-Resident Seller
The property-TDS mechanism described above is for payment to a resident seller. If the seller is a non-resident, do not use the resident-seller property form merely because the property is in India. TDS for payment to a non-resident is governed by the separate provisions applicable to non-residents, and the rate may depend on the nature of the income, capital gains position, applicable surcharge/cess, treaty provisions and any lower/nil deduction certificate.
Because non-resident property transactions can involve substantially different withholding obligations, professional advice may be appropriate before releasing the sale consideration.
Documents and Details to Keep Ready
- Buyer's PAN and contact details.
- Seller's valid PAN and residential status.
- Property address and property type.
- Agreement / allotment date and consideration.
- Applicable stamp duty value.
- Date and amount of each payment or credit.
- Date of tax deduction and tax amount.
- Bank/payment acknowledgement and challan details.
Frequently Asked Questions
Is TDS still 1% on property purchase in 2026?
Yes, for a qualifying purchase of immovable property from a resident seller, the current provision prescribes 1% on the higher of the consideration or stamp duty value, subject to the statutory threshold and other applicable provisions.
Is the ₹50 lakh test based only on sale price?
No. The current rule takes into account the consideration and the stamp duty value. TDS applies where the statutory ₹50 lakh threshold condition is met.
Do I need a TAN for this property TDS?
The PAN-based property TDS mechanism does not ordinarily require the buyer to obtain a separate TAN solely for this purpose.
What happened to Form 26QB?
Form 26QB belongs to the earlier Income-tax Act, 1961 framework. For relevant events on or after 1 April 2026, Form 141 under the Income-tax Act, 2025 is the current challan-cum-statement.
What is the due date for Form 141?
Form 141 is to be furnished and the deducted amount paid within 30 days from the end of the month in which the deduction is made.
Disclaimer: This page is for general information and procedural guidance. Tax treatment can depend on the transaction date, residential status, nature of property, consideration, stamp duty value and other facts. Verify the current law, rules and portal instructions before filing.