TDS ON PROPERTY(FORM 26QB)

From 1 June 2013, when a buyer buys immovable property like a building or any land other than agricultural land which costs more than Rs 50 lakhs, he has to deduct tax at source while paying the seller. The TDS thus deducted should be at 1% of the total sale consideration. It is the buyer who is required to deduct TDS and not the seller. Moreover, if the buyer is making the payment in installments, then the TDS will be deducted on every installment. From September 2019, the cost considered for the immovable property will consist of all charges which will be incidental to the transfer of immovable property, for eg. car parking fee, club membership fee, etc.

It is not mandatory for buyers of immovable properties to obtain a Tax Deduction Account Number to make payment of TDS on immovable property. The buyer could simply use his PAN to file TDS on immovable property. The buyer will require the PAN of the seller as well or else the TDS that will be deducted is 20%. The TDS can be paid using the Form 26QB within 30 days from the end of the month when the TDS was deducted. After depositing the TDS, within 10-12 days- the buyer will be obtaining a TDS certificate in the form 16B which he has to furnish to the seller.

Request for Form 16B

This is the TDS Certificate for Sale of Property. Requests for Form 16B can be made on the website tdscpc.gov.in after creating a new ID as a taxpayer. Usually, after payment, it takes 4-5 working days for the processing of challans, only after which you can request Form 16B. Form 16B is itself indicates that TDS deducted on payment to the seller has been deposited to the government.