TDS on Property Calculator - Sec 194-IA & 194-IB | Bizeneed
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The key facts, in one place
Everything a founder usually has to piece together from five different pages, in one place.
- Section Applicable
- 194-IA / 194-IB
- TDS Rate
- 1% (Property) / 10% (Rent)
- Property Threshold
- ₹50 Lakhs+
- Rent Threshold
- ₹50,000/month
- Form to File
- 26QB / 26QC
- Expert Support
- 24/7
What is TDS on Property?
TDS on property refers to Tax Deducted at Source applicable on transactions involving immovable property (land, building, or both) and rental income. The Income Tax Act mandates buyers and tenants to deduct tax before making payment, ensuring a steady flow of revenue to the government.
Under Section 194-IA, any person buying an immovable property worth ₹50 lakhs or more must deduct TDS at 1% on the total consideration. The buyer is responsible for depositing this TDS with the government and filing Form 26QB.
Under Section 194-IB, tenants paying rent exceeding ₹50,000 per month must deduct TDS at 10% on the rent amount. The tenant files Form 26QC and provides Form 16C to the landlord.
Our TDS on Property Calculator helps buyers, sellers, tenants, and landlords compute the exact TDS amount, understand compliance requirements, and avoid penalties.
TDS on Property: Section 194-IA vs 194-IB
Understand the key differences between TDS on property purchase and TDS on rent.
Section 194-IA
Purchase of immovable property
Section 194-IB
Monthly rent payments
| Aspect | Section 194-IA | Section 194-IB |
|---|---|---|
| Applicable On | Purchase of immovable property | Monthly rent payments |
| Threshold | Property value ≥ ₹50 lakhs | Monthly rent > ₹50,000 |
| TDS Rate | 1% (2% if seller no PAN) | 10% |
| Who Deducts | Buyer | Tenant |
| Form to File | Form 26QB | Form 26QC |
| Due Date | 30 days from end of month of deduction | 30 days from end of month of deduction |
| Higher Rate for No PAN | Yes (2% under Sec 206AA) | No (no higher rate provision) |
| Certificate Issued | Form 16B | Form 16C |
Who Needs This Calculator?
- Homebuyers purchasing residential property worth ₹50 lakhs or more - to calculate TDS deduction and file Form 26QB.
- Commercial property buyers acquiring office space, shops, or land - to comply with Section 194-IA.
- Real estate investors buying multiple properties - to compute cumulative TDS obligations across transactions.
- Tenants paying monthly rent exceeding ₹50,000 - to deduct and deposit TDS under Section 194-IB.
- Property sellers without PAN - to understand the higher 2% TDS rate applicable on their sale proceeds.
- Landlords receiving rent with TDS deducted - to claim credit in income tax returns and track TDS certificates.
- Property developers and builders - to handle TDS compliance for buyers purchasing under-construction properties.
- NRI buyers and sellers - to understand additional withholding requirements under Section 195.
Documents Required
Common to every entity
- PAN Card (Buyer/Tenant)Mandatory
- PAN Card (Seller/Landlord)Mandatory
- Aadhaar Card (All Parties)Mandatory
- Property Sale Agreement / Title DeedMandatory
- Property Registration DocumentMandatory
- Rent AgreementMandatory
- Address Proof of Buyer/TenantMandatory
- Address Proof of Seller/LandlordMandatory
- TAN (Tax Deduction Account Number)Mandatory
TDS Compliance Process
Determine Applicability
For property purchase: verify if consideration is ₹50 lakhs or more. For rent: check if monthly rent exceeds ₹50,000. Confirm PAN availability of all parties.
Calculate TDS Amount
Use our TDS calculator to determine the exact TDS amount. For property: 1% (or 2% if seller lacks PAN). For rent: 10% of monthly rent.
Deduct TDS from Payment
Buyer deducts TDS from the sale consideration before transferring funds. Tenant deducts TDS from each monthly rent payment.
Deposit TDS with Government
Use TAN and correct challan code (0020 for companies, 0021 for non-companies). Deposit within 30 days from the end of the month of deduction.
File TDS Return
File Form 26QB for property purchases (no quarterly requirement) or Form 26QC for rent. Issue Form 16B (for property) or Form 16C (for rent) to the deductee within 15 days of filing.
Compliance Timeline
Key dates to remember for TDS compliance on property transactions:
| Stage | Duration |
|---|---|
| Day of Transaction | |
| Within 7 Days | |
| Within 30 Days | |
| Within 15 Days of Filing |
Pricing & Fees
Choose a plan for end-to-end TDS compliance assistance.
Basic
Calculator + guidance
- TDS calculation support
- Form 26QB/26QC filing
- Email support
Standard
End-to-end compliance
- Full TDS compliance handling
- Both property & rent filings
- Priority support
- Certificate issuance
Premium
Complete tax solution
- Multiple property TDS
- Annual compliance package
- 24/7 CA support
- ITR filing assistance
Full fee breakdown
| Particulars | Government fee | Professional fee |
|---|---|---|
| Government Fee (Challan 281) | As per TDS amount | Included in plan |
| Form 26QB Filing | Nil | As per plan |
| Form 26QC Filing | Nil | As per plan |
| Penalty for Late Filing u/s 271H | ₹200/day | Assistance available |
Find Your TDS Compliance Plan
Answer a few questions and we'll recommend the best compliance plan for your needs.
What type of transaction do you need help with?
What is the approximate transaction value?
How often do you make such transactions?
Benefits of Using Our Service
Accurate Calculations
- Precise TDS computation based on the latest Income Tax Act provisions and circulars.
Compliance Assurance
- Timely filing of Form 26QB and Form 26QC to avoid penalties under Section 271H.
PAN Guidance
- Clear guidance on PAN requirements for buyers, sellers, tenants, and landlords.
Certificate Management
- Issue and manage Form 16B (property) and Form 16C (rent) certificates for all parties.
NRI Support
- Special handling for NRI property transactions with additional withholding under Section 195.
End-to-End Support
- From calculation to filing, we handle the complete TDS compliance lifecycle.
Common Mistakes to Avoid
Not deducting TDS when property value exceeds ₹50 lakhs
Always check the total consideration including all charges (stamp duty, registration, etc.).
Deducting TDS on the entire amount including GST
TDS is deducted only on the property value, not on GST or other statutory charges.
Missing the 30-day deposit deadline
Set calendar reminders and use our compliance tracking to ensure timely deposits.
Not obtaining PAN from seller/landlord
Always request PAN details before the transaction to avoid the higher 2% rate.
Filing Form 26QB in the wrong TAN
Verify TAN and buyer/tenant details before submitting the form.
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Why Choose Bizeneed for TDS Compliance?
Frequently asked questions
Section 194-IA mandates that any person purchasing an immovable property (land, building, or both) worth ₹50 lakhs or more must deduct TDS at 1% on the total consideration paid to the seller. The buyer must deposit this TDS with the government and file Form 26QB.
The standard TDS rate on property purchase under Section 194-IA is 1% of the total consideration. If the seller does not have a PAN card, the rate increases to 2% as per Section 206AA read with Section 194-IA.
The buyer of the property is responsible for deducting TDS at source. The buyer must deduct the tax before making the payment to the seller and deposit it with the government. This responsibility cannot be transferred to the seller.
Section 194-IB requires tenants paying monthly rent exceeding ₹50,000 to deduct TDS at 10% on the rent amount. The tenant must file Form 26QC on the TRACES portal and provide Form 16C (TDS certificate) to the landlord within 15 days.
TDS on rent is applicable when the monthly rent exceeds ₹50,000. If the monthly rent is ₹50,000 or less, no TDS deduction is required under Section 194-IB. The tenant should still report rent payments in their records.
Form 26QB is the TDS return form for property purchase transactions under Section 194-IA. The buyer files this form on the TRACES portal within 30 days of the end of the month in which TDS was deducted. It includes details of the buyer, seller, property, and TDS amount.
Form 26QC is the TDS return form for rent payments under Section 194-IB. The tenant files this form monthly on the TRACES portal within 30 days of the end of the month in which TDS was deducted. It includes details of the tenant, landlord, rent amount, and TDS deducted.
If the buyer fails to deduct TDS, the Income Tax Department may treat the full property value as the buyer's income. Additionally, the buyer is liable to pay interest on the TDS amount that should have been deducted, and penalties up to the amount of TDS that was not deducted.
Yes, the seller can claim credit for the TDS deducted by the buyer. The TDS amount will reflect in the seller's Form 26AS and they can claim it as advance tax while filing their income tax return. Form 16B serves as the TDS certificate.
Yes, TDS provisions apply to NRI property transactions as well. For NRI sellers, TDS is deducted under Section 195 at applicable rates (1% or 2% under 194-IA, or higher rates under 195). NRI sellers may apply for a lower TDS certificate from the Income Tax Department.
Under Section 271H, if TDS is not deposited or the TDS return is not filed within the due date, a penalty of ₹200 per day is levied until the default is rectified. Additionally, failure to deduct TDS may attract a penalty equal to the amount of TDS not deducted.
Yes, TAN (Tax Deduction and Account Number) is mandatory for deducting TDS under both Section 194-IA and 194-IB. The buyer/tenant must apply for TAN online on the NSDL portal before making the first TDS deduction. Without TAN, the TDS payment and filing will be rejected.
Written by Bizeneed Research Team, Business Compliance & Tax Experts
Last updated 2026-09-06
Sources
- Income Tax Act, 1961 - Sections 194-IA & 194-IB
- Central Board of Direct Taxes (CBDT)
- TRACES Portal
- NSDL TAN Portal
The information on this page is for general guidance only and does not constitute legal or tax advice. Consult a Chartered Accountant for advice specific to your situation.
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