Under Section 194-IA of the Income Tax Act, 1961, any individual who buys a property (excluding agricultural land) for more than Rs. 50 lakh is required to deduct TDS at 1% of the sale value. This TDS must be paid to the government using Form 26QB within 30 days from the end of the month in which the deduction was made.
For instance, if a sale occurred on 15 June 2025, the TDS should be paid by 31 July 2025. This rule only applies if the property was bought on or after 1 June 2013. Transactions before this date are not covered.
Form 26QB is a challan-cum-return statement that must be filed for the deposit of Tax Deducted at Source (TDS) on property transactions. As per the Income Tax Act, 1961, when purchasing a property valued at more than Rs. 50 lakh, the buyer is required to deduct 1% TDS and deposit it with the government.
Under the Income Tax Act, TDS is required to be deducted at 1% by the buyer if the property value exceeds Rs. 50 lakh. Form 26QB simplifies this process, allowing buyers to report and pay TDS on property transactions online, ensuring compliance with tax regulations.
Read on to understand what Form 26QB is, the step-by-step process for filling it online, and the penalty charges associated with non-compliance.
Required information associated with Form 26QB
Form 26QB is crucial for buyers involved in high-value property transactions. Here's an overview of the requirements, structured for easy understanding:
1. Purpose and requirement
Form 26QB is a combined form and challan used to pay TDS on property purchases exceeding Rs. 50 lakh. As per the Income Tax Act, the buyer must deduct 1% of the total consideration and pay it to the government within 30 days from the end of the month in which the deduction occurred.
2. Details captured
The form requires the following details:
- PAN of both buyer and seller
- Complete address of the property
- Sale consideration value
- Date of transaction and payment details
3. Additional guidelines
Particulars | Guidelines |
Property value | TDS applies only if the sale price is above Rs. 50 lakh |
TAN requirement | TAN is not needed to file Form 26QB |
PAN details | PAN of both buyer and seller is mandatory |
Instalment payments | If paid in instalments, TDS should be deducted proportionately |
Multiple buyers/ sellers | A separate Form 26QB must be filed for each buyer-seller combination |
Agricultural land | TDS is not applicable if the property qualifies as agricultural land under the Act |
Note: Land will not be treated as agricultural if:
- It is located in a municipality or cantonment area with a population over 10,000, or
- It lies within specific distances from such areas, as shown below:
Distance from municipality/ cantonment | Population range |
Up to 2 km | 10,000–1,00,000 |
Up to 6 km | 1,00,000–10,00,000 |
Up to 8 km | Above 10,00,000 |
4. Penalties for non-compliance
Delays or errors in filing Form 26QB may lead to penalties and interest as per the Income Tax Act.
How to file Form 26QB online?
Filing Form 26QB online is fairly simple if you follow these steps:
- Visit the TIN-NSDL portal: Go to the official TIN NSDL website.
- Select the relevant option: Under the section “TDS on Sale of Property”, click on “Online form for TDS”.
- Choose applicable challan: Select the relevant challan for Form 26QB based on your transaction.
- Enter the required details: Keep the following information handy before filling:
- PAN details of buyer and seller
- Address and contact details of both parties
- Property documents
- Total sale value and TDS amount
- Submit and confirm: Fill out all the fields and confirm the details. After successful submission, you’ll see an acknowledgement number—save this for your records.
- Print the form and make payment: Click “Print Form 26QB” for your records, then proceed to “Submit to Bank” to complete the payment using net banking (available with authorised banks).
- Download the challan: Once the payment is complete, download the challan with the CIN and bank details.
- Issue Form 16B: After payment, the buyer must provide Form 16B (TDS certificate) to the seller within 15 days.
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How to pay TDS online for 26QB
The process for paying TDS (Tax Deducted at Source) online for Form 26QB involves the following steps.
- Visit the TIN-NSDL website (https://www.tin-nsdl.com/)
- Navigate to the "TDS on Sale of Property" section
- Select Form 26QB for TDS on property sale
- Fill in buyer and seller PAN, property details, and TDS amount
- Choose the payment mode (internet banking or card)
- Generate the TDS Challan
- Make the online payment
- Receive the Challan acknowledgment as proof of payment
- Submit the filled Form 26QB and Challan acknowledgment if required
- Download the TDS certificate (Form 16B) from the TRACES website (https://www.tdscpc.gov.in/)
Please note that procedures may be subject to change, and it is advisable to check the official website of the Income Tax Department or consult with a tax professional for the most up-to-date information.
Taxable amount for TDS deduction on property sale under section 194IA
Under section 1994IA, TDS (Tax Deducted at Source) is applicable on the sale of immovable property exceeding Rs. 50 lakhs. The taxable amount for TDS deduction is the total consideration paid or credited for the transfer of the property. This includes any monetary payment, as well as non-monetary consideration like movable property or services rendered. The TDS rate is 1% of the total consideration. However, if the seller is a resident and provides a Permanent Account Number (PAN), the TDS rate is reduced to 0.75% of the total consideration.
Penalty charges associated with Form 26QB
Failing to follow the TDS rules for property transactions can result in various penalties. Below is a breakdown:
Summary of penalties
SL No. | Reason for penalty | Charges applicable |
1 | Delay in filing Form 26QB | Rs. 200 per day (Section 234E) |
2 | TDS deducted but not paid | 1.5% interest per month |
3 | TDS not deducted at all | 1% interest per month |
4 | Delay in submitting the TDS statement | Rs. 10,000 to Rs. 1 lakh (Section 271H)* |
* No penalty under Section 271H if you pay TDS with interest and file the required statement in the specified time.
Important notes
- The daily fee of Rs. 200 is charged for each day of delay but will not exceed the actual TDS amount.
- Interest is charged monthly and continues until the TDS is deposited.
- Timely compliance helps avoid both legal issues and extra costs.
In summary, it is crucial to deduct, deposit, and report TDS promptly using Form 26QB to avoid penalties and keep your transaction legally compliant.
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How to download Form 26QB?
Form 26QB is a form used in India for the payment of tax deducted at source (TDS) on the sale of property. The form is typically used by the buyer to report the TDS deduction to the income tax department. The process may vary, and it's recommended to check the official website of the Income Tax Department or consult with a tax professional for the most accurate and up-to-date information.
To download Form 26QB for the payment of tax deducted at source (TDS) on the sale of property in India, follow the below steps:
- Visit the NSDL website (https://www.tin-nsdl.com/).
- Navigate to the section related to Form 26QB or TDS on the sale of property.
- Select the appropriate assessment year.
- Fill in the required details, including PAN of the buyer and seller, property details, and TDS amount.
- Download the filled form from the website.
- If necessary, submit the downloaded form along with required documents to the designated authorities.
When should Form 26QB be filed?
If you’ve purchased a property worth over Rs. 50 lakh, you must file Form 26QB within 30 days from the end of the month in which TDS was deducted.
Example: Suppose you purchased a property on 15 December 2024. The deadline for filing Form 26QB and submitting the TDS amount would then be 30 January 2025.
Missing the deadline will lead to a late filing fee of Rs. 200 per day under Section 234E of the Income Tax Act. In addition, interest charges or further penalties may apply if the deducted TDS is not paid on time or if the deduction was not made at all.
Hence, it’s important to:
- Deduct 1% TDS from the total transaction value at the time of payment
- File Form 26QB and deposit the TDS within the specified time
- Issue Form 16B to the seller within 15 days of making the payment
Following these timelines helps you stay compliant with tax laws and avoid penalties.
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