As per Finance Act 2019, Consideration for transfer of immovable property shall include all charges of the nature of club membership fee, car parking fee, electricity or water facility fee, maintenance fee, advance fee or any other charges of similar nature, which are incidental to transfer of the immovable property.

Even when the amount is paid in installments, then even you are liable to deduct TDS @ 1% on the amount paid if the total amount paid is equal to or exceeds Rs. 50 Lakhs.

TDS is required to deduct irrespective of type of property whether it is land or building or vacant plot, residential or commercial or industrial property.
If GST is levied on transaction value for purchase of property, then TDS would be deducted on the amount excluding GST amount.

TDS on Property – Points to Remember

1. The responsibility to deduct TDS on Property Sale rests solely with the Buyer even if it is financed by Home Loan or property is purchased from the builder. In some cases, Bank can deduct TDS on property from disbursement and help in depositing TDS on buyers behalf but they are not obliged to do so. You have to give written request to Bank for the same.
2. TDS on Property Sale should be deposited with Govt by the Buyer within 30 days from the end of the month in which the TDS is deducted.
3. While depositing TDS on Property Sale, it is mandatory to Quote both Buyer and Seller’s PAN.
4. Non-deduction of TDS or Non Deposit of TDS may attract a heavy penalty.
5. TDS should be deducted at the time of payment to the seller. If the payment is in installments than TDS should be deducted with each installment. If the entire amount is paid in single installment than entire TDS amount should be deducted at the time of making complete payment.
6. TDS on Property Sale can be deposited with Govt by filing Form 26QB Challan.
7. All details related to property transaction should be furnished in form 26QB
8. You can deposit TDS online through following link
   https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp
9. After depositing TDS on property sale with Govt, the buyer needs to issue TDS certificate to the Seller. TDS Certificate is referred as form 16B. It is available online after 10-14 days from the date of deposit of TDS. TDS certificate can be downloaded online from following link
   http://contents.tdscpc.gov.in/

Penalty for Non-Deduction/ Deposit of TDS on Property

Interest on Late Deposit of TDS on Property – In case the TDS has not been deducted, the buyer would be required to pay 1% interest per month on the amount not deducted. In case, the TDS has been deducted but has not been paid, Interest @ 1.5% per month would be applicable in such a case.

Penalty for Late Deposit of TDS on Property –The Income Tax Officer may also levy a penalty of upto Rs. 1 Lakhs for Late Deposit of TDS on Property.

Penalty for Late Filing of Form 26QB -In case of late filing of TDS Return, a penalty of Rs. 200 per day would be levied. However, the Penalty should not exceed the amount of TDS for which this Form has not been filed.

Document/information required for Deposit of TDS on Property with Govt.

Form 26QB is required to be furnished mentioning all details which include:-

1. PAN No. of the Buyer
2. Address of the Buyer
3. PAN No. of the Seller
4. Residential Status of the Seller
5. Address of the Seller
6. Address of the Property transferred
7. Date of Payment
8. Amount Paid
9. Date of Agreement
10. Total Transaction Value

How to make payment of TDS to Government?
Following steps are involved while making the payment of TDS :-

• First go to the website https://www.tin-nsdl.com/
• Click on the tab Services and then click e-payment : Pay taxes Online.
• After that a new window will be open, that contains different challans for payment of TDS under different sections.
• Click on proceed on TDS on Property (Form 26QB) tab (in third row first column).

Details required for filing the Form 26QB
In the First Tab (Taxpayer Info) following details are required to be filled:

• Tax Applicable
  • (0020) Corporation Tax (Companies)
  • (0021) Income Tax (Other than Companies)
  Select code 0020 if you are a company (person deducting TDS), otherwise select 0021 for persons other than company.
• Financial Year– It will be auto populated on the basis of Date of Payment / Credit filled in the form.
• Assessment Year– It will be auto populated on the basis of Date of Payment / Credit filled in the form.
• Type of Payment– It is auto selected as (800) TDS on Sale of Property.
• Status of Payee / Seller / Transferor– Select Resident or Non-Resident .
• Permanent Account No. (PAN) of Transferee (Payer/Buyer)– Enter the PAN of Buyer which is compulsory required to fill the form. After filling the PAN, it will automatically confirm the category of PAN of Transferee whether it is company, individual etc.
• Permanent Account No. (PAN) of Transferor (Payee/Seller)– Enter the PAN of Seller which is required so that it is reflected in Form

In the Second Tab (Address) following details are required to be filled:

• Complete Address of the Transferee (Buyer)– It also require whether there are more than one transferee / buyer.
• Complete Address of the Transferor (Seller)– It also require whether there are more than one transferor / seller.

In the Third Tab (Property Details) following details are required to be filled:

• Complete Address of the Property Transferred– It includes details like type of property whether it is land or building, Date of Agreement / booking, Total Value of Consideration, Payment Type (Lump sum or Installment).
• Amount paid / credited– Enter amount in figures and words.
• Tax Deposit Details– Provide details like Total Amount paid / credited, Basic Tax , Interest , Fee (if any).

In the Fourth Tab (Payment Info) following details are required to be filled:

• Mode of Payment– Select e-payment immediately or on subsequent date.
• Date of Payment / Credit
• Date of Tax Deduction
• Captcha Code

Date of Payment / Credit and Date of Tax Deduction is required to calculate the interest, fee if any which is required to be paid in case of late payment.
After payment of taxes, Challan is generated which is the proof of payment of TDS.

Request for Form 16B [TDS Certificate for Sale of Property]

• Request can be made at tdscpc.gov.in after creating New ID as Tax payer.
• For New ID creation Mobile No & Email Id.
• Generally after payment of challan, it takes 4-5 working days for processing of challans, only after that you can request for Form 16B.
• Form 16B is itself evidence that TDS deducted on payment to seller has been deposited to government.