Tax and duty
TDS under section 194-IA, and Form 26QB
This is the obligation in an Indian property purchase that nobody quotes you, because there is no party to the transaction whose job it is to raise it. It belongs to the buyer, it is not moveable by agreement, and missing it does not stop mattering once the deed is registered.
The buyer deducts
Not the seller. Not the promoter. Not the bank disbursing your loan, and not the advocate drafting your deed. Section 194-IA of the Income-tax Act, 1961 puts the obligation on the transferee — the person acquiring the property — and it cannot be moved by agreement between the parties.
Last reviewed . Nothing here is tax advice. Take the rate, the threshold and the deadline from the Income Tax Department, and take your own position from your chartered accountant.
What this page answers
What actually has to happen
Four steps, in this order
None of them carries a figure here, and two of them carry a deadline that is fixed by a rule rather than by this page. What the sequence gives you is the shape — enough to know what to ask your chartered accountant, and when.
- 01
Establish who the seller is
Resident or non-resident, and how many of them there are. Section 194-IA deals with a payment to a resident transferor; where the seller is a non-resident an entirely different provision operates, with a different form and a tax deduction account number actually required. Joint sellers and joint buyers multiply the paperwork rather than dividing it.
- 02
Deduct when you pay, not at the end
The deduction is made at the time the amount is credited to the seller's account or at the time of payment, whichever is earlier. On a construction payment plan that means every instalment, not one settlement at the close.
- 03
File and pay Form 26QB
One form that is both the statement and the challan, filed through the Income Tax Department's portal, per buyer and per seller. The deadline runs from the end of the month in which the deduction was made and is fixed by the Income-tax Rules, 1962 — read the rule rather than a summary of it.
- 04
Download Form 16B and hand it over
The certificate of deduction comes from TRACES, and issuing it is the buyer's obligation too. It is the step that gets skipped: the money is deposited, the certificate is never issued, and the seller cannot evidence the credit.
The form and the payment both live on the Income Tax Department’s own portal, and the certificate comes from TRACES. Those two addresses are in the source register at the foot of this page, named rather than quoted.
The position
Why this page prints no rate, threshold or deadline
All three move. The rate and the threshold are in the section and are amended by Finance Acts; the deposit period is in the Income-tax Rules, 1962 and has been changed by amendment. Each is named with its provision instead.
Every figure on this subject is set by a notification, a rule, a schedule or a Finance Act, and each of those is amended without warning you. The duty on a conveyance, the registration fee, the rate on an under-construction home, the rate and threshold a buyer withholds under section 194-IA — none of them is a fact about the world. Each is a fact about what somebody published last.
A web page that prints one of those numbers is a snapshot with no expiry date on it. It cannot know when the notification changed, so it goes on stating the old figure with exactly the confidence it had on the day it was written — to you, and to the answer engines that quote it. That is what happens to every page in this subject that prints a rate, including the ones that were right when they were published.
So these pages print none. What they give you instead is the part that does not go stale: which authority sets the figure, where that authority publishes the current one, what the figure is charged on, who owes it, when it falls due, and which document proves it was paid. Take the number from the authority. Take the structure from here.
What is not on this page
- No stamp duty percentage, for either state.
- No registration fee percentage, for either state.
- No GST rate, and no deemed value fraction from the rate notification.
- No guidance value and no guideline value — not a figure, not a range, not an example.
- No rate, threshold or penalty amount under section 194-IA.
- No rupees per square foot, and no worked total that would imply one.
- No completion or handover date, on any project, anywhere on this site.
The GST page and the two stamp-duty pages work to the same standard on the other charges in a purchase.
A number in the body of an Act is quoted, with its section. You can check it against the bare Act in a minute, which is the same standard this site's glossary applies to statutory definitions. There are very few such numbers on these pages — the period the Registration Act, 1908 allows for presenting a document, in section 23, is the clearest of them.
A number fixed by notification, rule, schedule or Finance Act is named, not printed. Every rate on this subject is in that class. The authority that publishes the current one is named and linked instead, on every answer that would otherwise be tempted to quote it.
A section number we did not transcribe is marked, not guessed. Where the Act is certain and the section was not checked against the bare Act, the Act is cited and the section carries a visible mark. A confident-looking citation nobody verified is worse than an admitted gap, because a reader cannot tell the two apart.
Nothing here is advice, and none of it is specific to your transaction. These pages describe a general structure. What you owe depends on your document, your residence status, the parties and the property, and that is a conversation with your own advocate and your own chartered accountant — neither of whom is us.
Six questions
Tax deducted at source under section 194-IA
A withholding obligation the Income-tax Act, 1961 puts on the BUYER of immovable property: deduct from what you pay the seller, deposit it with Form 26QB, and give the seller the certificate.
- Where the current figure is publishedThe address to go to instead of trusting a number on a page like this one. If a figure matters to your decision, take it from here on the day you need it.
The Income Tax Department. The bare section is on India Code and on the department's own site; the rate, the threshold and the current form are on the department's portal, which is also where the payment is made.
Form 26QB is filed and paid through the Income Tax Department's portal. A great many guides still send you to an older tax information network address; this page has not verified what that address does today, and the department's own portal is the one to start from.
SourcesIncome Tax Department, Government of India — Income Tax Department e-filing portal (opens in a new tab)Legislative Department, Ministry of Law and Justice, Government of India — India Code — the bare Acts (opens in a new tab)
- What the figure is charged onThe part buyers get wrong. Two homes at the same agreed price can carry different charges, because the agreed price is not always the amount the charge is computed on.
The sum paid to the seller for the transfer — and here the two halves of this site's tax pages meet. Section 194-IA refers not only to the consideration but to the STAMP DUTY VALUE of the property: the same published value that drives stamp duty in Karnataka and Tamil Nadu reappears in the buyer's income-tax obligation.
So the guidance value or guideline value you looked up to work out the duty is not finished doing work when the deed is registered. If it exceeds what you agreed to pay, it can affect what you are required to withhold. That is a question for your chartered accountant with the actual numbers in front of them, and it is a question worth asking BEFORE the payment goes out rather than after.
One exclusion is worth knowing: the section deals with immovable property other than agricultural land.
The Act, and the section
- Income-tax Act, 1961 — section 194-IA
Frames the obligation by reference to both the consideration for the transfer and the stamp duty value of the property.
SourcesIncome Tax Department, Government of India — Income Tax Department e-filing portal (opens in a new tab)Legislative Department, Ministry of Law and Justice, Government of India — India Code — the bare Acts (opens in a new tab)
- Income-tax Act, 1961 — section 194-IA
- Who owes itNot always the person who hands over the money. On one of these charges the obligation sits with the buyer and almost nobody knows it, which is how a penalty arrives years later.
THE BUYER. Not the seller, not the promoter, not the bank disbursing your loan, not the advocate drafting the deed. The Act puts the obligation on the transferee — the person acquiring the property — and it is not transferable by agreement.
This is the single most-missed obligation in an Indian property purchase, and the reason it is missed is structural rather than careless: every other charge in the transaction is quoted to you by somebody. Stamp duty is quoted at the counter. GST arrives on a demand letter. This one is quoted by nobody, because there is nobody in the transaction whose job it is to raise it — and no tax deduction account number is needed, so nothing in the process forces the buyer to discover it.
Missing it does not go away when the deed is registered. The Act treats a person who fails to deduct or to pay as being in default, with interest running, a fee for late filing of the statement, and a penalty provision behind that. Those consequences fall on the buyer.
One case where the section does NOT apply, and it changes everything: where the seller is a non-resident. Then this section is not the one that operates — the withholding provision for payments to a non-resident is, with a different mechanism, different forms and a tax deduction account number actually required. Establish the seller's residence status before you plan the payment, not after.
The Act, and the section
- Income-tax Act, 1961 — sections 201 and 201(1A)
Treat a person who does not deduct or pay as an assessee in default and provide for interest.
- Income-tax Act, 1961 — sections 234E and 271H
Provide for a fee for late delivery of the statement, and a penalty for failure to deliver it or for furnishing incorrect information.
- Income-tax Act, 1961 — section 195
Governs deduction from a payment to a non-resident, which is the provision that applies instead of section 194-IA where the seller is a non-resident.
SourcesIncome Tax Department, Government of India — Income Tax Department e-filing portal (opens in a new tab)Legislative Department, Ministry of Law and Justice, Government of India — India Code — the bare Acts (opens in a new tab)
- Income-tax Act, 1961 — sections 201 and 201(1A)
- When it falls dueLate is a different amount from on time, and on some of these it is a different document as well. The deadline runs from an event, not from your convenience.
The deduction happens at the time the amount is credited to the seller's account or at the time of payment, whichever is earlier. In a construction payment plan that means on each instalment, not once at the end — the obligation follows the money.
The deposit and the statement then run on a deadline fixed by the Income-tax Rules, 1962: a period running from the END OF THE MONTH in which the deduction was made. The length of that period has been changed by amendment to the Rules, so this page names the rule instead of printing the number. Read Rule 30 on the day you need it, or ask your chartered accountant.
Form 26QB is a challan-cum-statement — one form that is both the return and the payment. It is filed per buyer and per seller: two buyers and one seller means two forms, and joint ownership is where this usually goes wrong.
The Act, and the section
- Income-tax Act, 1961 — section 194-IA
Fixes the moment of deduction — credit to the transferor's account or payment, whichever is earlier.
- Income-tax Rules, 1962 — rule 30
Fixes the period within which tax deducted under section 194-IA is to be paid to the credit of the Central Government, running from the end of the month of deduction. The period is amended by notification and is not printed here.
SourcesIncome Tax Department, Government of India — Income Tax Department e-filing portal (opens in a new tab)Legislative Department, Ministry of Law and Justice, Government of India — India Code — the bare Acts (opens in a new tab)
- Income-tax Act, 1961 — section 194-IA
- What proves it was paidA payment you cannot evidence later is a payment you may be asked to make again. This is the piece to keep, and the piece to ask for before you sign anything.
Three documents, and you need all three. The Form 26QB acknowledgement, the challan showing the payment reached the government, and Form 16B — the certificate of deduction, which the buyer downloads from TRACES and hands to the seller.
Form 16B is the buyer's obligation too, and it is the step that gets skipped: the money is deposited and the certificate is never issued, so the seller cannot evidence the credit. The seller should be able to see the deduction reflected in their own annual tax statement on the Income Tax Department's portal, which is the independent check that the deposit landed against the right person.
If you are buying, keep all three with the registered deed. If you are selling, ask for Form 16B before the documents leave your hands — it is far harder to obtain from a buyer who has already got what they wanted.
The Act, and the section
- Income-tax Act, 1961 — section 203
Requires the person deducting tax to furnish a certificate of deduction to the person from whose income it was deducted.
SourcesTDS Reconciliation Analysis and Correction Enabling System, Income Tax Department — TRACES (opens in a new tab)Income Tax Department, Government of India — Income Tax Department e-filing portal (opens in a new tab)
- Income-tax Act, 1961 — section 203
Where this meets the duty pages
The published value follows you here
The value a state department publishes for stamp purposes does not stop working once the deed is registered. It appears again in the section that governs what the buyer withholds.
Section 194-IA frames the obligation by reference to the consideration for the transfer and to the stamp duty value of the property. That second phrase is the same published value the stamp-duty pages on this site are about — guidance value in Karnataka, guideline value in Tamil Nadu.
So the lookup you did to work out the duty is doing a second job. If the published value exceeds what you agreed to pay, it can affect what you are required to withhold, and that is a question worth putting to your chartered accountant before the payment leaves your account rather than after.
It is also a reason to do the lookup early. Both departments publish for free, both publish before you commit to anything, and both are linked from the pages below.
The two lookups
Karnataka — the Department of Stamps and Registration, on the Kaveri portal.
Tamil Nadu — the Registration Department, on TNREGINET.
Neither page prints a figure. Both name the department and link the page where the current one is published.
Questions people ask
Questions
Every answer below is the exact string this page publishes as structured data. There is no second version written for machines.
- Who deducts tax under section 194-IA — the buyer or the seller?
- The buyer. Section 194-IA of the Income-tax Act, 1961 puts the obligation on the transferee, the person acquiring the property, and it cannot be moved by agreement. Nobody in the transaction raises it with you, which is why it is the most-missed obligation in an Indian property purchase.
- Do I need a TAN to deduct tax under section 194-IA?
- No. Section 194-IA(3) disapplies section 203A, so a buyer does not need a tax deduction account number. That is what makes the obligation practicable for an individual, and it is also why nothing in the process forces a buyer to discover the obligation exists.
- What is Form 26QB?
- A challan-cum-statement — one form that is both the return and the payment for tax deducted under section 194-IA. It is filed through the Income Tax Department's portal, and it is filed per buyer and per seller, so joint ownership means more than one form. That is where compliance usually goes wrong.
- What does the seller get as proof?
- Form 16B, the certificate of deduction, which the buyer downloads from TRACES and gives to the seller. The seller should also see the credit reflected in their own annual tax statement on the Income Tax Department's portal. If you are selling, ask for Form 16B before the documents leave your hands.
- Does section 194-IA apply if the seller is a non-resident?
- No. Where the seller is a non-resident, the withholding provision for payments to non-residents applies instead, with a different mechanism, different forms and a tax deduction account number actually required. Establish the seller's residence status before you plan the payment, not afterwards.
Everything this page relies on
Sources, and how each was handled
Two kinds, and the difference is printed rather than smoothed over. One set was opened; the other is named so you can reach the authority, and nothing here is quoted from it.
Opened
Already in this site's own source register for the portal guides and the jurisdiction finder, and opened on the date that register records.
Department of Stamps and Registration, Government of Karnataka
Sub Registrars — office directory (opens in a new tab)igr.karnataka.gov.in
The department that administers stamp duty and registration in Karnataka, and the sub-registrar offices a document is presented at.
Department of Stamps and Registration, Government of Karnataka
Kaveri Online Services (opens in a new tab)kaveri.karnataka.gov.in
Karnataka's registration portal — where a document is registered and searched, where the office holding a village is confirmed, and where the department publishes the values and charges this page refuses to print.
Department of Stamps and Registration, Government of Karnataka
Kaveri Online Services — the older address (opens in a new tab)kaverionline.karnataka.gov.in
The address a great many guides still send you to. Our own portal walkthrough records that it did not respond from our network on the date it was checked, while the name still resolves.
Registration Department, Government of Tamil Nadu
TNREGINET — Inspector General of Registration (opens in a new tab)tnreginet.gov.in
Tamil Nadu's registration portal — where a document is registered and searched, where the sub-registry holding a village is confirmed, and where the department publishes the guideline value.
The register a project on Karnataka land is registered on, and searched on.
The register a project on Tamil Nadu land is registered on, and searched on.
Every SUYUG registration number, authority, promoter and survey line transcribed from the certificate — the primary-source version of the two-state comparison on these pages.
Every address above was opened on . Government sites move their pages; if one of these no longer resolves, the fact it holds up is unverified until someone finds where it went, not true because it was true once.
Named, not opened
The department's own published address, named here so you can reach the authority. It was not opened as part of this review, and this page quotes nothing from it.
Legislative Department, Ministry of Law and Justice, Government of India
India Code — the bare Acts (opens in a new tab)Where the text of a central or state Act is read, so that every section cited on this page can be checked against the section rather than against us.
Central Board of Indirect Taxes and Customs, Government of India
CBIC — GST notifications and circulars (opens in a new tab)Where the rate notifications issued under the Central Goods and Services Tax Act, 2017 are published, and where they are amended.
Goods and Services Tax Council
GST Council (opens in a new tab)The constitutional body whose recommendations precede a change in a GST rate, and which publishes what it recommended and when.
Goods and Services Tax Network
GST common portal — Search Taxpayer (opens in a new tab)Where a supplier's GST identification number is checked against the register, so an invoice can be tested rather than believed.
Income Tax Department, Government of India
Income Tax Department e-filing portal (opens in a new tab)Where Form 26QB is filed and paid, where the bare section is published, and where a taxpayer reads their own annual tax statement.
TDS Reconciliation Analysis and Correction Enabling System, Income Tax Department
TRACES (opens in a new tab)Where the buyer downloads Form 16B — the certificate that proves to the seller that the tax deducted actually reached the government.
Adjacent
What to read next
Raise it before the payment, not after
We will not compute your withholding for you — that is your chartered accountant’s work, with your documents in front of them. What we will do is never let a payment schedule leave this office without this obligation having been named out loud.