TDS on Sale of Immovable Property under the Income-tax Act, 2025
By CA Deepak Kumar Chopra · Chartered Accountant· Published 9 August 2026· Updated 15 August 2026· 4 min read
Key takeaways
- Section 393(1), Table Sl. No. 3(i) of the Income-tax Act, 2025 governs TDS on the transfer of immovable property other than agricultural land.
- TDS rate is 1% where the prescribed conditions are satisfied.
- TDS applies when the sale consideration or stamp duty value is ₹50 lakh or more, as prescribed.
- TDS is calculated on the higher of the sale consideration or stamp duty value.
- The buyer/transferee is responsible for deducting and depositing the TDS.
- For transactions governed by the Income-tax Act, 2025, the buyer is required to use Form 141 – Challan-cum-Statement, with Schedule B for TDS on transfer of immovable property.
- Form 26QB relates to transactions governed by the Income-tax Act, 1961, while Form 141 applies under the new Act from 1 April 2026, subject to the applicable transition rules.
- The Finance Act, 2026 corrected the cross-reference error in Note 3 to align it with the correct Table Sl. No. 3(i) provision.
- Buyers should ensure that PAN details, property details, consideration, stamp duty value and payment particulars are correctly reported while filing the TDS statement.
- Proper and timely TDS compliance helps avoid interest, late fees and other consequences under the applicable provisions.
1. When is TDS Applicable?
As per section 393(1) Any consideration for transfer of any immovable property (other than agricultural land) is credited or paid or distributed by the person [other than the person who are required to deduct tax under serial number 3(iii)] during the tax year, to a resident, the person responsible (Buyer) for paying such income or sum shall deduct income-tax :
(a) On the entire amount of such income or sum, where the amount or aggregate of amounts upto or exceeds the threshold limit ₹50 lacs ;
(b) At the rate 1% of
- Consideration for transfer of the immovable property; or
- Stamp duty value of such property,
whichever is higher.;
(c) At the time of credit of such income or sum to the account of the payee or at the time of its payment in cash or by way of a cheque or a draft or by any other mode, whichever is earlier;
Example
Mr. A purchases a residential property from Mr. B for:
- Sale consideration: ₹60 lakh
- Stamp duty value: ₹65 lakh
Since the relevant value is ₹50 lakh or more, TDS provisions apply.
TDS would be calculated at 1% of the higher applicable amount, i.e., ₹65 lakh:
TDS = ₹65,00,000 × 1% = ₹65,000
Thus, the buyer would deduct ₹65,000 as TDS.
2. Which TDS Form is to be Filed by the Buyer?
For transactions where the relevant credit/payment occurs on or after 1 April 2026, the corresponding requirement is to be complied with through Form No. 141 – Challan-cum-statement of deduction of tax under Section 393(1).
For TDS on transfer of immovable property, the buyer is required to select Schedule B – TDS on transfer of immovable property under Section 393(1) in Form 141.
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