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Understand how to pay tds on sale of property by filing 26qb form. In this guide H&R Block has listed out the important things one should consider while selling their immovable property in India.

How to File TDS on Sale of Property?

Last Update Date : February 13, 2018

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.

What is Form 26QB?

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.

Payment of TDS on sale of Property

  • The buyer has to deduct TDS @ 1% of the total sale consideration. Note that the buyer is required to deduct TDS, not the seller.
  • No TDS is deducted if sale consideration is less than Rs 50 lakh. If instalments are being paid, TDS has to be deducted on each instalment.
  • Tax is to be paid on the entire sale amount. For example, if you have bought a house at Rs 55 lakh, you have to pay tax on Rs 55 lakh and not on Rs 5 lakh (i.e. Rs 55 lakh – Rs 50 lakh). This is applicable even when there is more than 1 buyer or seller.
  • If you are the buyer, you do not need to obtain a TAN (Tax Deduction Account Number) number.
  • If you are the seller, you have to provide your PAN or else TDS is deducted at 20%. PAN of the buyer is also mandatory. TDS is deducted at the time of payment or at the time of giving credit to the seller, whichever is earlier.
  • This TDS has to be deposited along with Form 26QB within 7 days (30 days from 1.6.2016) from the end of the month in which TDS was deducted.
  • After depositing TDS to the government, the buyer is required to furnish the TDS certificate to the seller. This is available around 10-15 days.
  • Thus for paying TDS the buyer is required to file Form 26QB and the seller is required to obtain Form 16B.
  • In case of purchase of the property form Non-resident seller, the TDS has to be done u/s 195 and this section will not be applicable in such cases.

How to File 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

Form 26qb Challan for Payment of TDS on Sale of Property Screenshot 1

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.

Form 26QB for Corporate Tax Payers Screenshot 1

Form 26QB for Corporate Tax Payers Screenshot 2

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.

From 26QB - Select Mode of Payment

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.

How to Generate and Download Form 16B

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.

Steps to Generate Form 16B

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.

If you still haven’t filed your Income Tax Return, you are at the right place. File your IT returns with H&R Block to experience effective and hassle-free tax filing. Our tax experts will file your return for you while you sit back and concentrate on your work

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