TDS on Sale of property is required to be deducted @1% if the property value is more than Rs. 50 Lakhs. This TDS is required to be deducted for all transactions after 1st June 2013 if the property transaction value is more than Rs. 50 Lakhs. This is applicable on sale of all properties except on sale of Agricultural Land.
It is also important to note here that 1% TDS is applicable only if the seller is Resident in India. If the seller is not-resident in India i.e. he is an NRI, then the rate of TDS will change.
The rate of TDS in case of sale of property by Non-Resident would be 20% + Surcharge + Cess. TDS on Sale of Property by NRI would be levied even if the Transaction Value is less than Rs. 50 Lakhs.
Things To Remember when claiming TDS under u/s 194IA Section 194IA is not applicable on a transfer of agricultural land and compulsory acquisition of immovable property. Neither the buyer nor the seller needs to obtain the TAN for deduction of TDS TDS must be deposited to the credit of the Central Government within 30 days from the end of the month in which TDS is deducted. The buyer must pay TDS using Form 26QB and mention the seller’s PAN mandatorily. Do not commit any error in quoting the PAN or other details in the online Form as there is no online mechanism for rectification of errors. For the purpose of rectification you are required to contact Income Tax