Step wise online process to pay TDS on Sale of Immovable Property
Form 26QB is a return cum challan form for the payment of Tax Deducted at Source (TDS) to the government for deductions made under Section 194-IA of the Income Tax Act, 1961. This section of the Act specifically deals with transactions involving the sale of immovable property and the applicable TDS along with Form 26QB needs to be submitted within 30 days counted from the end of the month in which TDS was deducted. For instance, if the transaction occurred on 14th March then Form 26QB must be mandatorily submitted by 30th April.
The Income Tax Act, 1961 has laid out a few key rules regarding sale and purchase of immovable property. In such transactions covered under Section 194-IA, the buyer, also known as the deductor, is required to deduct TDS if the transaction value is more than Rs. 50 lakhs. Subsequently, the deductor will required to issue Form 16B to the deductee (seller).
All the requirements for Form 26QB have been listed under Section 194-IA. They are:
- Under Section 194-IA, the buyer must deduct TDS at the rate of 1% of the total sale amount at the time of completing the transaction.
- TDS u/s 194-IA is not applicable to transactions involving agricultural land.
- TDS on immovable property sale is not applicable for transactions valued at less than Rs. 50 lakhs. For transactions beyond this limit, TDS is deducted on the entire transaction amount.
- If the payment is made in installments then TDS is deducted proportionately on each individual installment.
- The buyer does not need to obtain Tax Deduction Account Number (TAN) to deduct and deposit TDS. However, PAN is mandatory for both the seller and the buyer in case TDS deduction occurs using Form 26QB.
- The buyer is supposed to deposit TDS and submit form 26QB within 30 days from the end of the month in which TDS was deducted.
- In case there are multiple buyers and sellers involved in the transaction, the deductor will be required to submit multiple Form 26QB.
- After deducting and depositing TDS, the buyer must furnish a TDS certificate to the seller within 15 days of the transaction in lieu of the tax deducted and deposited to the government.
- The buyer must then obtain Form 16B and furnish it to the seller.
Online Procedure for filing Form 26QB:
Following are the stepwise process to file form 26QB
Click on “Proceed” button of “TDS on property (Form 26QB)”
Step 2: Filing of Form
Fill the complete form as applicable below:
Tax Payer Info: Enter the details of both Buyer and Seller in this page:
- Select the tax applicable i.e. (0021) for Persons other than company and (0020) For Company assessees
- Select Status of the Seller/ Transferor i.e. whether he is resident or Non- resident
- Select whether PAN of Seller/ Transferor is available or not
- Enter PAN no of the Buyer, confirm the PAN of the Tenant by entering once again
- Enter PAN no of the Seller/ Transferor confirm the PAN of the Seller/ Transferor by entering once again
Now click on “Next” button
Step 3: Enter Address of Both Buyer and Seller:
- Enter complete Communication address, mail id and mobile no of Buyer.
- Select “Yes” or “No” in case there is more than one Buyer.
- Enter complete address, mail id and mobile no of Seller.
- Select “Yes” or “No” in case there is more than one Seller.
Step 4: Enter Property details: Now enter the details of the property sold:
- Type of property sold i.e. whether the property is land or building or both
- Complete address of the property
- Date of agreement
- Value of Property Sold
- Select, whether amount is paid in Lumpsum or Installment
- Enter Total amount paid or Credited
- Enter TDS at 1% of amount paid or Credited
- Enter the of Date of Payment or Credit of payment to the Seller
- Enter the Date of Tax deduction
After above details are entered click on “Next” button
Step 5: Payment Info:
Enter the payment information as below:
- The mode of payment i.e. payment of tax online or payment of tax through bank visit. In case of payment of tax online the person can pay tax online and in case of payment of tax through bank visit the person has to take hard copy of Form 26QB to the bank and pay through cheque
- Enter the captcha code and click on “Proceed” button
After above step Form 26QB gets generated.
In case payment of tax online it will redirect you to the bank portal, now enter the net banking login Id password and make payment. On successful payment a challan counterfoil will be displayed containing CIN, payment details and bank name through which e-payment has been made. This counterfoil is proof of payment being made.
In case payment of tax through Bank visit it will redirect you to download “Form 26QB”, download the form and take print outs.