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TDS on property purchase calculator
Buying a home worth ₹50 lakh or more? You hold back 1% from the seller and pay it to the tax department. Here is exactly how much, per payment.
Deposit it with Form 26QB within 30 days from the end of the month you paid, then give the seller Form 16B. Estimate only; check the current rule with the Income Tax Department.
The rule in one line
Under section 194-IA of the Income-tax Act, 1961, the buyer of an immovable property other than agricultural land deducts 1% as tax at source (TDS) when the price, or the stamp duty value, is ₹50 lakh or more. Since 1 April 2022 the 1% is worked out on whichever of the two is higher.
Please note: the Income-tax Act, 2025 replaces the 1961 Act from 1 April 2026, and the same duty may now be numbered differently. The arithmetic here does not change with the number, but check the current section on the Income Tax Department’s portal before you file.
An illustrative example
Say a flat is priced at ₹75 lakh (an example, not a Reeva price) and you pay 10% at booking. The TDS on that payment is 1% of ₹7.5 lakh, which is ₹7,500. You pay the builder ₹7,42,500 and deposit ₹7,500 through Form 26QB. Over the whole deal the TDS adds up to ₹75,000. It is not an extra cost: it is part of the price, paid to the government instead of the seller.
Steps, in order
- Collect the seller’s PAN. Without a valid PAN the rate becomes 20% under s.206AA.
- File Form 26QB online with each payment, and pay the challan.
- Download Form 16B from TRACES and give it to the seller.
- Keep the challan and Form 16B with your home papers.
TDS is one of several costs around the price. See the stamp duty calculator and the GST calculator, or read the first-home guide for the full order of payments. This page is a guide, not tax advice; a chartered accountant can confirm your case.
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- The Shalott Marque2 and 3 BHK homes at S Medihalli, Sarjapur–Attibele Road. Price on request.
FAQ
Questions people ask
I am the buyer. Why do I have to deduct tax?
Section 194-IA of the Income-tax Act, 1961 puts the duty on the buyer. When a home costs ₹50 lakh or more, you keep back 1% of each payment and deposit it with the government in the seller’s name. The seller gets credit for it against their own tax.
Do I need a TAN to deposit this TDS?
No. For s.194-IA you deposit it with your PAN using Form 26QB, a combined challan and statement on the Income Tax e-filing portal. You do need the seller’s PAN.
I pay the builder in stages. When do I deduct?
At each payment. If the deal is ₹50 lakh or more, every instalment, including the booking amount, has 1% held back. The part your bank pays directly is also a payment by you, so make sure TDS is handled on it too; many banks ask you to confirm this.
What if I miss the deadline?
Form 26QB is due within 30 days from the end of the month in which you paid. Late deduction or late deposit attracts interest under s.201(1A), and a late statement attracts a fee under s.234E. Doing it on the day you pay avoids all of this.
Does the new Income-tax Act 2025 change this?
The Income-tax Act, 2025 replaces the 1961 Act from 1 April 2026. The buyer’s duty to withhold continues, but the section number and the form names may have changed. Check the current section and form on the Income Tax Department’s portal before you pay.
Does it apply to The Shalott Marque?
It applies to any home where the price or stamp duty value is ₹50 lakh or more. Ask the Reeva team for the price of the home you like, and we will show you how the TDS fits into each instalment.
Want to run these numbers on a real home?
Ask the Reeva team for the price of a home at The Shalott Marque, then put it into the calculator. We will walk you through the costs, the paperwork and the loan, plainly.