Form 26QB is a TDS certificate, which is required to be filed by a buyer of property for the deduction of TDS (tax deducted at source) while making payment to a seller for the sale of a property. This form is mandatory for every person who buys a property, which is valued at more than Rs. 50 lakh. In this article, we will explain the procedure for form 26QB download and the step-by-step guide for TDS on property sale.
What is form 26QB?
Form 26QB is an online challan-cum-declaration form. As per Section 194-IA of the Income Tax Act, 1961, a buyer must deduct 1% TDS from the total amount before paying the seller (if the property is worth more than Rs. 50 lakh).
Now, this form is a way to pay this 1% TDS. It must be filled by a property buyer when purchasing an immovable property (like a flat, house, or plot) in India, if the property's value is over Rs. 50 lakh.
Let’s understand how it works:
- Assume that the property is worth Rs. 90 lakh.
- Now, the buyer must deduct Rs. 90,000 (which is 1% of Rs. 90 lakh) as TDS and deposit it to the government.
- Please note that this deduction is not made on the extra Rs. 40 lakh (Rs. 90 lakh - Rs. 50 lakh).
- However, it is made on the full Rs. 90 lakh or the stamp duty value (whichever is higher).
Please note that Form 26QB must be filed online within 30 days from the date of the property transaction. It should include these details:
- Buyer's and seller’s PAN
- Property details
- Transaction amount
- TDS amount
- Payment date
The buyer must pay the deducted TDS using this form. After payment, the buyer issues a TDS certificate (Form 16B) to the seller.
When should form 26QB be filed?
Form 26QB to be filed within 30 days from the end of the month in which TDS is deducted. The person who is responsible for making the payment of TDS is required to file this form and make the payment. The purchaser is required to file Form 26QB even if the property value is less than Rs. 50 lakh.
Procedure to pay TDS through form 26QB
The following steps should be followed to pay TDS through Form 26QB:
Step 1: Go to the official income tax India website and click on the TDS on sale of property tab.
Step 2: Select the Form 26QB option.
Step 3: Fill in the details such as the buyer's PAN, seller's PAN, and the property details such as the address, purchase price, and TDS amount.
Step 4: Select the payment option and make the payment through net banking or credit card.
Step 5: After the payment is successful, a TDS certificate will be issued which should be downloaded.
How to download Form 26QB
To download Form 26QB, follow the below steps:
Step 1: Go to the official income tax India website.
Step 2: Click on the TDS on sale of property tab.
Step 3: Select Form 26QB option.
Step 4: Enter the details such as the buyer's PAN, seller's PAN, and the property details such as the address, purchase price, and TDS amount.
Step 5: Click on the download option to download Form 26QB in pdf format.
Penalty charges associated with form 26QB
In case the TDS payment is not made within the time limit, a penalty of 1% per month or part of the month until the payment is charged. The penalty is calculated from the date on which the TDS was deducted until the date of payment of the TDS amount.
Penalty Type |
Section |
Charge |
Limit/Conditions |
Late Filing Fee |
234E |
₹ 200 per day of default |
Maximum = TDS amount |
Penalty for Delayed Filing |
271H |
₹ 10,000 to ₹ 1,00,000 |
May not apply if TDS paid, form filed within 1 year, reasonable cause exists. |
Interest for Late Payment of TDS |
201(1A) |
1.5% per month or part of a month |
From deduction date to payment date. |
In conclusion, Form 26QB is a necessary document that should be filed by the buyer of the property for the deduction of TDS while making payment to the seller. The procedure to pay TDS through Form 26QB, as well as the process of how to download Form 26QB, has been explained in the article. It is essential to file this form on time to avoid any penalty charges.
Who Needs to File Form 26QB?
As per the provisions under Section 194-IA of the Income Tax Act, any buyer purchasing an immovable property (excluding agricultural land) worth ₹50 lakh or more must deduct 1% TDS when making payment to the seller.
The buyer is responsible for filing Form 26QB to deposit the deducted TDS with the government within 30 days from the end of the month in which the payment was made. Once filed, the buyer must issue Form 16B to the seller as proof of TDS deduction.
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Correcting Errors in Form 26QB
If you have made an error while filing Form 26QB, you can correct it online through the TRACES website. Common mistakes include incorrect PAN details, payment amount, or property details.
Steps to Correct Form 26QB Online:
- Visit the TRACES portal and log in with your credentials.
- Navigate to “Statements/Forms” > “Request for Correction” and select Form 26QB.
- Submit the correction request and upload any required documents.
- Once verified, the changes will be processed.
It is essential to correct errors promptly to avoid penalties or tax discrepancies.
Things to remember by seller of the property
If you are selling a property for more than Rs. 50 lakh, give your PAN (Permanent Account Number) to the buyer. This allows the buyer to report the 1% TDS correctly to the Income Tax Department.
Next, after the TDS is paid, check your Form 26AS (available on the income tax website). It should show the TDS amount deducted by the buyer. This ensures the buyer has correctly deposited the TDS amount with the government against your PAN.
Things to remember by purchaser of the property
If you are buying a property of value more than Rs. 50 lakh, you must deduct 1% TDS from the total amount before paying the seller. Additionally, you should:
- Always collect the seller’s PAN and make sure it is correct.
- Enter both your PAN and the seller’s PAN correctly when filling out Form 26QB online.
- If there’s any error in PAN details, contact the Income Tax Department forthwith.
- After paying the TDS, you must file a TDS return on time. Be aware that filing delays can lead to penalties.
How to fill form 26QB online?
As mentioned before, when you buy a property worth more than Rs. 50 lakh, you need to deduct 1% TDS (Tax Deducted at Source) and deposit it with the Income Tax Department. This is done using Form 26QB, which is an online form available on the TIN NSDL website.
To download the Form 26QB, you can follow these simple steps:
Step 1: Visit the official TIN NSDL website.
Step 2: On the homepage, go to the section that says “TDS on Sale of Property”. Under that, click on “Online Form to File TDS”.
Step 3: You will be asked to select the challan. Choose the applicable one for TDS on the sale of immovable property under Section 194-IA.
Step 4: Now, you’ll be taken to a form that requires the following information. Keep these documents and details ready:
- PAN details of both buyer and seller (verify they are valid and correct).
- Address and contact details (of both buyer and seller).
- Property details (such as the full address of the property).
- Amount paid for the property and the TDS amount to be deducted.
- Date of transaction and payment details.
Step 5: After entering all the information, click on “Submit”. A confirmation screen will appear showing the entered details. Review everything once again.
If correct, click “Confirm”. Once submitted, an Acknowledgement Number will be displayed. You should save or print this for future reference.
Step 6: Now, click on “Submit to the Bank”. You will be redirected to your bank’s net banking portal (only selected authorised banks are available). Make the payment through net banking.
Step 8: Once payment is successful, a challan is generated. This document includes important information like the:
- CIN (Challan Identification Number)
- Bank name
- Payment date
- Amount paid
Download and save it, as you will need it while issuing the Form 16B TDS certificate to the seller.
Please note that the entire process should be completed within 30 days of making the property payment.
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Requirements associated with form 26QB
Form 26QB is used when buying property in India (if the value is over Rs. 50 lakh). It is connected to Section 194-IA of the Income Tax Act, 1961, which specifies rules for tax deduction when buying immovable property.
As an assessee, you must satisfy all the following requirements associated with Form 26QB:
1. TDS deduction by the buyer
If you are buying a property for more than Rs. 50 lakh, you must deduct 1% TDS (Tax Deducted at Source) from the total sale value. For example,
Say a property costs Rs. 80 lakh. Now, you deduct Rs. 80,000 as TDS and pay Rs. 79.20 lakh to the seller.
2. No TDS if the property value is below Rs. 50 lakh
If the property's value is Rs. 50 lakh or less, you don’t have to deduct any TDS. This rule applies to the entire property value.
3. No need for TAN
Usually, people deducting TDS need a TAN (Tax Deduction Account Number). However, for Form 26QB, a TAN is not required. You only need to mention the PAN numbers of both the buyer and the seller.
4. PAN is mandatory
Both buyer and seller must provide valid PAN details. If these are entered incorrectly, the TDS payment will not be recorded correctly. This can lead to future tax issues.
5. Multiple buyers or sellers
If there is more than one buyer or seller, then each buyer must submit a separate Form 26QB.
6. Equal TDS deduction by multiple buyers
If multiple people are buying the property, each one must deduct TDS in equal proportion to their share. For example, if two buyers are paying Rs. 1 crore equally, each deducts Rs. 50,000 as TDS.
7. TDS for installment payments
If you are paying the seller in installments, then you must deduct and pay 1% TDS on each installment. This should be done every time you make a payment (not just at the end).
8. Issue Form 16B to the seller
After paying the TDS, the buyer must download and give the seller a Form 16B (TDS certificate). This must be done within 15 days of making the TDS payment.
9. No TDS on agricultural land
You don’t need to deduct TDS if the land is classified as agricultural land. As per the current rules, a land is not considered agricultural if it is within a cantonment or municipal area with a population over 10,000.
Also, lands located in any area within the distance given below are not agricultural lands:
Distance from municipality or 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 |
If the land falls within these limits, it will not be considered agricultural land, and TDS will be applicable.
How should tax deductions be submitted on form 26QB to the government?
When you buy a property worth more than Rs. 50 lakh, you are required to deduct 1% TDS (Tax Deducted at Source) from the sale amount. This TDS must be paid to the government using Form 26QB, which is an online form available on the TIN-NSDL website.
Let’s learn how you can submit it in simple steps:
Step 1: Fill out Form 26QB online
As soon as you deduct the TDS, visit the TIN-NSDL website. Go to the section for TDS on the sale of property. Choose Form 26QB and enter the following information:
- Buyer and seller details
- PAN numbers
- Address of the property
- Sale value
- Amount of TDS deducted
Be careful to enter accurate details to avoid errors or delays later.
Step 2: Make the TDS payment
After submitting the form, you will be taken to the payment page. You can pay the TDS online through net banking or a debit card of authorised banks. This payment should be made within 30 days from the end of the month in which the TDS was deducted.
Once the payment is successful, a challan with a CIN (Challan Identification Number) will be generated as proof of payment.
Step 3: Download and issue Form 16B
After the challan is generated, visit the TRACES website (https://www.tdscpc.gov.in) and register as a taxpayer. You can then use the challan details to download Form 16B, which is the official TDS certificate.
As a buyer, you must give this certificate to the seller within 15 days of payment. This acts as proof that TDS has been deducted and paid to the government.
Conclusion
Form 26QB is a combined challan and declaration form. It is used for depositing the 1% TDS deducted by the buyer under Section 194-IA of the Income Tax Act. This form must be filled and submitted by the buyer of immovable property valued above Rs. 50 lakh.
Filing this form accurately within 30 days of the transaction is mandatory. Additionally, buyers must:
- Ensure the correct PAN details of both parties
- Deduct TDS from the total sale value or stamp duty value (whichever is higher)
- Issue Form 16B to the seller after successful payment
Furthermore, in case of multiple buyers or sellers, each buyer must make individual submissions of Form 26QB. Additionally, the process is fully online and doesn’t require a TAN.
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