Understanding Form 26QB: TDS on Sale of Property in India

In India, Form 26QB is a crucial document used for paying Tax Deducted at Source (TDS) on property purchases exceeding Rs. 50 lakhs. As mandated by Section 194-IA of the Income Tax Act, 1961, the buyer (deductor) is responsible for deducting TDS at a rate of 1% from the sale consideration paid to the seller (deductee). Form 26QB acts as a combined challan-cum-statement for reporting this TDS deduction and depositing it with the government.

Who Needs to File Form 26QB?

The responsibility to file Form 26QB falls solely on the buyer if the property purchase value surpasses Rs. 50 lakhs. Here's a breakdown of the filing requirements:

• Transaction Value: More than Rs. 50 lakhs
• Buyer Responsibility: Deduct TDS at 1% and file Form 26QB
• TAN Requirement: Not required for buyers to file Form 26QB

Key Points to Remember When Using Form 26QB

• Deadline for Filing: The TDS deducted needs to be deposited with the government within 30 days from the month-end in which the TDS was initiated.
• Applicability: This TDS rule applies only to immovable property purchases made after June 1, 2013. Transactions finalized before this date are exempt from TDS filing.
• Multiple Buyers/Sellers: If there are multiple buyers or sellers involved in the property transaction, separate Form 26QBs need to be filed by each buyer.
• Instalment Payments: In cases where the property payment is made in instalments, the TDS deduction should also be done proportionally on each instalment.
• TDS Certificate for Seller: After deducting and depositing TDS, the buyer must issue Form 16B (TDS certificate) to the seller within 15 days, acknowledging the TDS amount paid to the government.
• Agricultural Land Exemption: It's important to note that agricultural land is excluded from TDS requirements. However, there are exceptions:
• Land situated within the limits of a Cantonment Board or Municipality with a population exceeding 10,000.
• Land situated within specified distances from Cantonment Board or Municipality limits, depending on the population range (refer to the provided table in the source article for details).

How to File Form 26QB Online

1. Visit the TIN NSDL website.
2. Navigate to the "TDS on sale of property" section and click on "Online Form to File TDS".
3. Select the appropriate challan type.
4. Enter the required details, including PAN details of both buyer and seller, contact information, property documents, total sale consideration, and TDS amount deposited.
5. After entering all details, submit the form and confirm on the verification screen. You'll receive an acknowledgment number, which should be saved for future reference.
6. Following confirmation, click on the "Print Form 26QB online" option to generate a printout.
7. To make the payment, choose the "Submit to the bank" option, which will redirect you to the net banking platform of authorized banks.
8. Upon successful payment, a challan with details like CIN, bank name, and other payment information will be generated.

Obtaining Form 16B

After successfully filing Form 26QB and depositing TDS, the buyer needs to issue Form 16B (TDS certificate) to the seller within 15 days. This document serves as official confirmation for the seller, acknowledging the TDS amount deducted and deposited on their behalf.

1. Visit the TRACES website.
2. Register and log in using the buyer's PAN details.
3. Provide details about the property transaction.
4. Enter the acknowledgment number received while filing Form 26QB, along with the assessment year and seller's PAN.
5. Click on "Submit Request” and note down the reference number.
6. Go to "Requested Downloads", search the form using the reference number to locate and download.