TDS on Sale of Property: Meaning, Online Payment, and Filing Guide

If you purchase an immovable property in India for Rs.50 lakh or more, you are required to deduct Tax Deducted at Source (TDS) under Section 393(1) (Table Sl. No. 3(i)) of the Income Tax Act, 2025. The deducted TDS must be deposited with the Central Government by filing Form 141 through the official income tax portal. 

This guide explains the TDS payment process, the documents you need, the steps to file the applicable form, and how to generate Form 132 after the payment is successfully completed. 

What is TDS on Sale of Property? 

Tax Deducted at Source (TDS) on the sale of property is a tax that the buyer is required to deduct before making payment to the seller in certain property transactions. Under Section 393(1) (Table Sl. No. 3(i)) of the Income-tax Act, 2025, TDS is applicable when an immovable property (other than agricultural land) is purchased from a resident seller, and the sale consideration or the stamp duty value, whichever is higher, is Rs.50 Lakh or more. 

The buyer must deduct 1% TDS from the amount payable to the seller and deposit it with the Central Government. The deduction is made at the time of payment or credit to the seller, whichever occurs earlier. This requirement helps ensure tax compliance in high-value property transactions. 

Understanding Section 393(1) (Table Sl. No. 3(i)) of the Income Tax Act 

Under Section 393(1) (Table Sl. No. 3(i)), TDS is applicable at 1% of the total sale consideration for immovable property (excluding agricultural land) if the sale value is Rs.50 Lakh or more. The buyer must deduct this amount before making the payment to the seller. TDS must be deposited within 30 days from the end of the month in which it is deducted. If the property is purchased in instalments, TDS must be deducted at the time of each instalment payment. Both buyer and seller must have valid PANs. Buyers do not need a TAN to deposit TDS under this Section. 

 Documents Required for TDS on Property Sale 

Before initiating the payment, ensure you have the following: 

• PAN of both buyer and seller 
• Property sale agreement 
• Payment details (transaction date and amount) 
• Buyer’s bank account details for online payment 
• Valid mobile number and email ID for OTP and communication 
• Login credentials for the Income Tax e-filing portal 

 Step-by-Step Guide to Filing TDS on Property Sale Online 

To complete the TDS on the sale of property online payment, follow these steps: 

1. Visit the Income Tax e-filing portal and log in using your PAN and password. 
2. Click on ‘e-File’ then ‘e-Pay Tax’ and then select ‘+ New Payment’. 
3. Choose ‘141 – TDS on Property’ and click ‘Proceed’. 
4. Enter buyer and seller details, property address, transaction date, and total sale amount. 
5. The system will automatically calculate 1% of the sale value as TDS. Verify and confirm the details. 
6. Choose your preferred mode of payment. 
7. Complete the payment and download the challan receipt for reference. 

 How to Obtain Form 132 After Filing TDS? 

After the TDS payment is processed, Form 132 can be downloaded as follows: 

1. Wait for a few days from the payment date.  
2. Visit the TRACES portal.  
3. Login using your PAN (as a buyer). 
4. Go to ‘Downloads’ and then ‘Form 132 (for Buyer)’.  
5. Enter the acknowledgement number from Form 141 and generate the form. 
6. Download and share Form 132 with the seller as proof of TDS deduction. 

How to Make Online Payment of TDS on Sale of Property?

Follow the steps given below to pay TDS online under Section 393(1) (Table Sl. No. 3(i)): 

1. Visit the Income Tax e-Filing portal and log in using their PAN credentials. 
2. Once logged in, navigate to the ‘e-File’ section and select ‘e-Pay Tax’. Click on ‘New Payment’ to initiate a fresh tax payment request. 
3. From the list of available challans, select ‘Form 141 – TDS on Sale of Property’ and click on ‘Proceed’. This form is specifically designed for depositing TDS deducted on the sale of immovable property. 
4. You will then be required to fill in ‘Form 141’ carefully. This includes entering details such as the PAN of the buyer and seller, complete property details, address of the property, date of agreement, date of payment, total sale consideration, and the amount of TDS deducted. 
5. After verifying all the details entered in the form, submit it to move to the payment stage. Choose online payment as the mode of payment. Available options typically include net banking, debit card, RTGS/NEFT, or payment through an authorised payment gateway. 
6. Proceed to complete the payment using the selected mode. On successful completion of the transaction, a challan counterfoil is generated. This counterfoil contains important details such as the Challan Identification Number (CIN), payment date, and amount paid, and serves as official proof of online TDS payment. 
7. After completing the TDS payment, visit the TRACES portal after about five days to download Form 132, which serves as the TDS certificate for the seller. 
8. To download Form 132, start by registering and logging in to the TRACES portal as a taxpayer, using your PAN. Once logged in, go to the ‘Downloads’ section and select ‘Form 132 (For Buyer)’. 
9. Next, enter the required details related to the property transaction. This includes the Assessment Year, the acknowledgement number of Form 141, and the seller’s PAN. After entering these details, click on ‘Proceed’. 
10. A confirmation screen will appear. Review the information and click on ‘Submit Request’ to place the download request. A success message will be displayed along with a request number, which should be noted for tracking purposes. 

11. Finally, go to ‘Requested Downloads’ to locate and download Form 132 once it becomes available. 

 TDS on Property Purchase: What Buyers Must Remember 

Buyers must deduct TDS before making each payment, especially if the sale is done in instalments. If there are multiple buyers or sellers, TDS still applies to the total sale value. Failure to deduct or deposit TDS on time can attract penalties and interest. In the absence of the seller’s PAN, TDS must be deducted at 20% instead of 1%, so verifying PAN details is essential. 

The online payment of TDS on the sale of the property is an essential step in the property-buying process. Ensuring timely deduction and accurate filing not only keeps you compliant with tax regulations but also avoids legal complications later.