**Property purchase TDS** is one of the most easily missed steps in a flat transaction. A buyer might negotiate the price, obtain a home loan and organise registration, then realise that a portion of the amount paid to the seller must first be deducted and reported to the Income Tax Department. This guide is especially important in **2026**, because India's income-tax law and reporting forms changed during the year.
The 2026 change: old 26QB versus new Form 141
For relevant payments or credits occurring on or before **31 March 2026**, older transactions were governed by the Income-tax Act, 1961, including section 194-IA and the familiar Form 26QB. For a relevant TDS event on or after **1 April 2026**, the Income-tax Act, 2025 applies. The Income Tax Department explains that consolidated **Form 141** replaced older challan-cum-TDS statement forms for current transactions. A homebuyer in October 2026 should therefore follow the live official portal workflow and the section and schedule applicable to that transaction, not blindly copy an older online tutorial.
When is one-percent TDS relevant?
For purchase of qualifying immovable property from a **resident seller**, the familiar threshold is ₹50 lakh. Government guidance explains that the trigger considers both consideration and stamp-duty value: the exemption applies only where both are below the threshold. The rate is generally **1%** in the standard resident-seller scenario. Extra charges that form part of the consideration may affect the calculation. Multiple buyers or sellers do not automatically allow the transaction to be split into smaller amounts to avoid the threshold.
For illustration, if a resident seller's covered transaction value is ₹80 lakh and the normal 1% rate applies to that amount, the basic deduction is ₹80,000. The precise taxable base, allocation between buyers and sellers, PAN status and actual payment schedule should be confirmed by your chartered accountant.
What to establish before signing
Ask whether the seller is resident or non-resident **for income-tax purposes**. Citizenship and an Indian address alone are not enough. Obtain correct PAN details and verify the names and shares of all sellers and buyers. Check the agreed consideration against stamp-duty valuation and identify which payments have already been made, including advance payments.
The tax obligation arises by reference to the earlier of credit or payment under the relevant provision, rather than only at final deed registration. If your purchase involves several instalments, your tax adviser should map the payments and filing dates.
