With effect from 1st June 2013 as per sec 194 IA, the purchaser of immovable property has to deduct tax at source from the consideration paid to the resident seller, wherein the consideration of such property exceeds or is equal to Rs 50 lakh. In this guide, we will discuss how to use and file Form 26QB for TDS on sale of property.
This TDS has to be made at the time of each credit/ payment to the seller’s account. Which in turn is to be deposited to the government account by way of a return cum challan (Form 26QB) within 30 days of the next month. In case if the buyer fails to deduct the taxes or deposit the same to the government account he will be considered as assessee in default and may get the notice for non-filing of Form 26QB.
Pay the TDS due along with the applicable interest and late filing fees and file the monthly return cum challan in Form 26QB for all the months wherein you have made any payments to the seller of the property.
Step 1: Payment through Challan 26QB (Online and Offline). Go to https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp
Step 2: Click on Form 26QB and select 0020 if you are corporate payer and 0021 if you are a non-corporate payer (individuals). Fill in all the necessary details.
Step 3: There are 2 modes of payment at the bottom of the page: e-tax payment immediately (through net banking facility) and e-tax payment on a subsequent date (e-payment of taxes by visiting any of the Bank branches). Choose the one which you prefer and click on Proceed.
Note: If you choose net-banking, you will be able to login to your bank and pay online. After you have paid, the bank lets you print Challan 280 with a tick on 800 (i.e. payment of TDS on sale of property). Print this out and keep it safely.
If you cannot pay online, an online receipt for Form 26QB with a unique Acknowledgment Number is generated for you. This is valid for 10 days after generation. You can take this to one of the authorized banks along with your cheque. The bank will proceed with the online payment and generate your challan.
After you have submitted TDS to the government by filing Form 26QB, you need to generate Form 16B which is the certificate of TDS submitted. The process to generate Form 16B is given below.
Step 1: If you are a first-time user, register on TRACES as a Taxpayer with your PAN Card Number and the Challan number registered during payment.
Step 2: Once you register, whether you are a seller or a buyer, you will be able to obtain your approved Form 16B. Check your Form 26AS seven days after payment. You will see that your payment is reflected in “Part F” under “Details of Tax Deducted at Source on Sale of Immoveable Property u/s 194(IA) [For Buyer of Property]”.
This gives you details such as TDS certificate number (which TRACES generates), name and PAN of deductee, transaction date and amount, acknowledgement number (which is the same as the one on your Form 26QB), date of deposit and TDS deposited.
Step 3: After your payment starts reflecting in Form 26AS, you can download your Form 16B. Login to TRACES, go to Download tab and click on Application for Request of Form 16B if the status of your Form 16B download request is Available to download your Form 16B.
You should be able to see that the status of your Form 16B download request is Available. If status says Submitted wait for a few hours more before repeating the last step. Download the .zip file. The password to open the .zip file is Date of Birth of Deductor (the format is DDMMYYYY). Your form will be available inside the .zip file as a pdf. Take a print out and keep it safely with you.