As per the Income Tax Act, if the buyer purchases any property from the seller and the consideration exceeds the specified limit then the buyer is liable to file Form 26QB. Further, form 26QB is a challan-cum return statement that contains the details of the property along with the amount of tax that needs to be deducted.
What is Form 26QB?
- Any individual/HUF buying an immovable property worth INR 50 lakhs or more needs to deduct TDS. Further, TDS is applicable as per section 194IA of the Income Tax Act.
- TDS will be deducted @ 1% from the sale consideration paid to the resident seller.
- Consideration for transfer of any immovable property shall include payments made for the club membership fees, car parking fees, electricity, water facility fees, maintenance fees, advance fees, or any other charges of a similar nature.
- The buyer of the property needs to file a TDS Return in Form 26QB. Also, TAN is not compulsory for the Buyer or Seller of the property. PAN of the buyer and seller is compulsory.
- TDS will be deposited along with Form 26QB.
- The buyer needs to issue a certificate of the same in Form 16B within 15 days from the due date for furnishing the challan-cum-statement in Form 26QB.
When to file Form 26QB?
The buyer needs to file Form 26QB within 30 days from the end of the month in which the tax deduction is made.
Let’s take an example to understand this:
Shyam purchased a property from Vikas. A sales consideration of INR 54,00,000 was paid on 15th December 2020. Here, Form 26QB needs to be filed on or before 30th January 2021 and if the return is not filed within the due date then late fees of INR 200/per day will be levied till the return is filed. Also, the late fee will not exceed the amount of TDS deducted.
What are the details required to file Form 26QB?
The following information is required:
- PAN of the buyer and seller.
- Complete Address of buyer and seller.
- Contact Details of buyer and seller.
- Property Details.
- Amount Paid/ Credited.
- Tax Deposit details.
How to file Form 26QB online?
- Log on to the website e-filing portal.
- Navigate to ‘e-file’ and click on ‘e-Pay tax’.
- Under e-pay tax, Click on ‘New Payment’.
- Select ‘Proceed’ under the ‘26 QB (TDS on Sale of Property)’ field.
- Fill out the complete form as applicable.
The details of the buyer will be auto-populated. The other details required to fill out the form are:
1. Residential Status of seller
2. PAN of the seller.
3. Communication details of the seller.
4. Property details
5. Amount paid/credited & tax details - After submitting, the next page will ask to select the mode of payment.
The user has the following option for payment:
1. Net banking;
2. Debit Card;
3. Pay at the Bank counter;
4. RTGS/NEFT; or
5. Payment Gateway including UPI and Credit Card.
- Select the appropriate payment mode.
Click on Continue to make the payment.
- Download the Statment cum Challan.
On successful payment, a challan counterfoil will be displayed containing CIN, payment details and bank name through which e-payment has been made. This counterfoil is proof of payment being made. The statement of proof can be downloaded in PDF format.
FAQs
Yes. Whenever a property is sold, a TDS of 1% is deducted by the buyer. Later, this TDS is deposited with the Government by the buyer. Hence TDS credits are allowed for the seller in their TDS Return.
In case the TDS has not been deducted on the property purchased, a 1% interest per month on the amount not deducted would be required to pay by the buyer.
Yes, The government has facilitated the revision of this form through the TRACES account. Hence, the buyer can log in to the TRACES and make the corrections in the permitted areas.
The buyer of the property has to deduct the TDS either at the time of executing the deed or at the time of advance payment, in case any advance is paid before executing the deed.
If the seller doesn’t have a PAN, then the TDS would be deducted at the rate of 20%.
Hi @Kajal7993
Could you please confirm the steps for the correction request of Form 26QB?
You will receive a confirmation message stating that your correction request has been submitted successfully.
Buyer of property can only submit request and file correction.
Hi @Muskan_Balar
Thank you for your reply. I followed the same steps. Please refer to the attachment to view the failed requests.
Hi @Kajal7993
Your query seems to be user specific. We would not be able to give a solution from this table.
Here, you can book a MEET where a dedicated tax expert can connect with you over a video call, understand your queries, and help you with a correction request of Form 26QB.
Hi @Shubhamsharma,
For seller approval of PAN under correction request of 26QB, the seller will have to login to Income Tax Portal > Pending Actions tab. Select Worklist and the request will appear in For Your Action tab, and the seller can approve the request here.
Hope this helps.
@CA_Niyati_Mistry hi! your replies have been really informative. Could you help with how I maybe able to download the challan cum statement for the rectified 26qb form with the changes once the status on TRACES has changed to “processed”?
Thank you in advance!
Hello @aarshna_shah,
You can login to TRACES using user id, PAN and password, then go to Statements/Forms tab and request for downloading 26QB after filing in the required details like Acknowledgement number, PAN of seller, etc. Once the file status is changed from Requested to Available under Downloads tab you can download the same.
Hope this helps!
Hello @aarshna_shah,
You can get the original Form 26QB from the Income tax portal. In case of correction through online mode on TRACES there is no option to download the same.
Hope this helps!
@CA_Niyati_Mistry I field for correction and got the approval from the seller. Now its pending approval from AO. Is there any pending action I need to take to AO approval? Approx how much time does it take for AO approval and whats the further process?
Hey @Mayank_Bajaj,
No, there is no further action required from your end for AO approval. It would take approximately around 15-30 days for AO’s approval.
Hope this helps!
@CA_Niyati_Mistry Thank you. It now shows as “Submitted to ITD”. How many approvals are there before it gets finally approved?