Section 194IA deals with the requirement of TDS deduction by the buyer at the time of purchase of the property. This section is applicable from 01st June 2013.

Points to be considered under Section 194IA:

1. When to deduct TDS: When a buyer buys immovable property (i.e. a building or part of a building or any land other than agricultural land) costing more than Rs 50 lakhs, he has to deduct tax at source (TDS) when he pays the seller.

2. Who will deduct TDS: Buyer of the property shall deduct TDS at the time of payment (Payment may be in lumpsum or in instalments).

3. Rate of TDS: The buyer has to deduct TDS at 1% of the total sale consideration.

4. TDS in case of payment in Instalments: TDS has to be deducted on each instalment paid, if the payments made in instalments.

5. Amount on which TDS to be Deducted: As per budget 2019 if the immovable property purchase on or after 01st September 2019, amount on which TDS to be deducted shall include all charges which are incidental to the transfer of the immovable property. TDS is to be paid on the entire sale amount.

6. Requirement of PAN/TAN of buyer: Buyer can pay TDS using his PAN. Buyer need not obtain a TAN paying TDS. Therefore buyer must have the PAN.

7. Requirement of PAN of Seller: Seller has to provide his PAN to buyer. If seller do not provide PAN, buyer shall deduct TDS @ 20%.

8. How to Pay TDS: Form 26QB has been prescribed by Government on NSDL website for filing of TDS under this section. Buyer needs to fill the form and pay the TDS.

9. Time limit to pay TDS: Buyer shall pay TDS within 30 days from the end of the month in which TDS was deducted.

10. Form to be issued to Seller: The buyer is required to obtain Form 16B from TRACES website and issues the form to the seller.

Link for steps for filing Form 26QB: https://whytax.in/income-tax/process-of-filing-form-26qb-tds-on-sale-of-property/

Links for form 26QB: https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp