TDS on Property Sale Above Rs 50 Lakhs: Rules and Compliance
Complete guide to TDS on property transactions above Rs 50 lakhs: buyer obligations, Form 26QB, NRI seller rules, and penalties for non-compliance.
title: "TDS on Property Sale Above Rs 50 Lakhs: Rules and Compliance" tag: "Tax & Legal" category: "Tax & Legal" description: "Complete guide to TDS on property transactions above Rs 50 lakhs: buyer obligations, Form 26QB, NRI seller rules, and penalties for non-compliance." readTime: "8 min" views: "4.1K" publishedAt: "2025-12-18" primaryKeyword: "tds property sale 50 lakhs" secondaryKeywords:
- "form 26qb property"
- "tds on property purchase"
- "tds rate property sale india" tags:
- "Tax & Legal"
- "TDS"
- "Compliance"
TDS Rules on Property Sale
When you buy a property (other than agricultural land) from a resident Indian seller for more than Rs 50 lakhs, you must deduct 1% TDS and deposit it with the government. This is the buyer's obligation, not the seller's.
TDS Rates at a Glance
| Seller Type | Property Value | TDS Rate | Deducted On |
|---|---|---|---|
| Resident Indian | Above Rs 50L | 1% | Sale consideration |
| NRI (LTCG) | Any amount | 20% | Full sale consideration |
| NRI (STCG) | Any amount | 30% | Full sale consideration |
| Below Rs 50L | Any | None | N/A |
How to Deduct and Deposit TDS (Form 26QB)
Step 1: Deduct TDS from Payment
Deduct 1% TDS from the payment made to the seller. TDS should be deducted from each installment if paying in parts.
Step 2: File Form 26QB Online
- Visit tin.tin.nsdl.com
- Select "Online form for furnishing TDS on property"
- Enter buyer details (PAN, address)
- Enter seller details (PAN mandatory)
- Enter property details and consideration amount
- Pay TDS online via challan
Step 3: Generate Form 16B
After depositing TDS, generate Form 16B (TDS certificate) from TRACES website and provide it to the seller.
Timeline
TDS must be deposited within 30 days from the end of the month in which deduction was made.
Penalties for Non-Compliance
| Default | Penalty |
|---|---|
| Not deducting TDS | 1% per month interest on TDS amount |
| Late deposit | 1.5% per month interest |
| Not filing Form 26QB | Rs 200 per day penalty (max: TDS amount) |
| Not issuing Form 16B | Rs 100 per day penalty |
Common Mistakes
- Not deducting TDS because "seller said they'll pay tax"
- Using wrong PAN for seller (verify before deduction)
- Not deducting on each installment (only on final payment)
- Seller not reflecting TDS in their 26AS — verify on TRACES
Use our Stamp Duty Calculator to calculate total acquisition costs including TDS. Book a consultation for compliance guidance.
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