Property TDS New Rule from 1 October 2026: TAN Requirement Changed

Income Tax New Rule: Property TDS Rules Change from 1 October 2026 – Complete Details

Important changes have been introduced in the TDS compliance framework under the Income-tax Act, 2025. One of the important changes relates to TDS on the transfer of immovable property.

However, there is an important clarification: Property TDS is not being introduced for the first time from 1 October 2026. The new Income-tax Act framework for transactions covered by the relevant TDS provisions applies from 1 April 2026.

The key change taking effect from 1 October 2026 is that a resident individual or Hindu Undivided Family (HUF) will not be required to obtain a TAN for deducting TDS on consideration for the transfer of immovable property under the specified provision. The amendment is intended to reduce compliance burden.

What Changes from 1 October 2026?

Under the Income-tax Act, 2025, compliance has been simplified for resident individuals and HUFs making TDS deductions on consideration for transfer of immovable property covered by the specified provision.

From 1 October 2026, a resident individual or HUF will not be required to obtain TAN for deducting TDS on consideration for transfer of immovable property under the specified provision. The change is specifically intended to reduce the compliance burden associated with property transactions.

Will TDS Still Apply When Buying Property?

Yes. The removal of the TAN requirement does not mean that the property TDS obligation has been abolished.

The Income Tax Department states that the new Act contains provisions for TDS on the transfer of certain immovable property under Section 393. The rates and monetary thresholds are broadly aligned with the earlier framework.

According to the Income Tax Department's Form 141 guidance, TDS is required for an applicable immovable-property transaction where the consideration exceeds ₹50 lakh.

What is Form 141?

Form 141 is the unified challan-cum-statement introduced under the Income-tax Act, 2025. It consolidates several earlier PAN-based TDS challan-cum-statements into one form.

For immovable property transfers, taxpayers have to use Schedule B of Form 141.

Schedules Under Form 141

• Schedule A: TDS on rent paid by an Individual/HUF
• Schedule B: TDS on transfer of immovable property
• Schedule C: TDS on payments by an Individual/HUF to contractors or professionals
• Schedule D: TDS on transfer of Virtual Digital Assets (VDA)

What Happened to Form 26QB?

Under the earlier Income Tax Act, 1961, buyers used Form 26QB for reporting TDS on the purchase of immovable property covered by Section 194-IA.

Under the new Income-tax Act, 2025 framework, these specified PAN-based challan-cum-TDS statements have been consolidated into Form 141. For immovable property transfers, the relevant section is Schedule B.

TDS on Property Above ₹50 Lakh

Property buyers should understand that the removal of TAN does not remove the TDS obligation. Where the applicable conditions and threshold are met, the buyer remains responsible for deducting TDS at the prescribed rate.

The Income Tax Department's Form 141 instructions specifically state that TDS is required when the value of consideration for the applicable property transaction exceeds ₹50 lakh.

What Details are Required in Form 141 for Property TDS?

For property transactions, Schedule B of Form 141 requires various transaction details. These include:

• Type of immovable property – Land or Building
• Complete property address
• Date of agreement
• Date of registration, if available
• Total stamp duty value
• Total consideration or property sale value
• Payment mode – Lump Sum or Instalments
• Instalment details, where applicable
• Required deductee/seller details
• TDS and challan-related information

The Income Tax Department's Form 141 guidance requires the total consideration and stamp duty value of the property to be reported in the specified fields.

When Does the TDS Have to Be Deposited?

Under the Form 141 framework, the deducted amount must be paid to the credit of the Central Government within 30 days from the end of the month in which the tax is deducted. Form 141 is also required to be furnished within the prescribed timeline.

Where Can You File Form 141?

Form 141 is available through the Income Tax e-Filing portal using PAN login.

For an immovable property transaction, select Schedule B – TDS on transfer of immovable property.

What About Transactions Before and After 1 April 2026?

The Income Tax Department has specified transition rules for transactions around the implementation of the new Act.

If the earlier event of credit or payment occurred on or before 31 March 2026, the relevant forms under the Income Tax Act, 1961 continue to apply.

If the earlier event of credit or payment occurred on or after 1 April 2026, the transaction is governed by the new Income-tax Act, 2025 framework and the applicable challan-cum-TDS statement is filed under the new system, including Form 141 for the specified transactions.

Has the TDS Rate Changed?

The main change discussed here is related to the compliance structure and TAN requirement, not a blanket change in the property TDS rate.

The Income Tax Department states that the TDS provisions have been reorganised into a simplified and tabular structure under the new Act and that the rates and thresholds are broadly the same as under the earlier framework. The exact applicable rate depends on the nature of the transaction and the relevant statutory provisions.

Important Points for Property Buyers

• Check whether TDS applies to the property transaction.
• Pay particular attention to applicable transactions where consideration exceeds ₹50 lakh.
• From 1 October 2026, a resident individual/HUF will not need TAN for the specified property TDS transaction.
• Use Schedule B of Form 141 for TDS on transfer of immovable property.
• Keep the PAN and required seller/deductee information accurate.
• Follow the prescribed TDS deduction and payment timelines.
• Keep agreements, challans and filing acknowledgements for records.

Conclusion

Property TDS is not being abolished from 1 October 2026. The important change is that resident individuals and HUFs will not be required to obtain TAN for deducting TDS on the specified transfer of immovable property transaction.

The new Income-tax Act, 2025 TDS framework has applied from 1 April 2026, and Form 141 with Schedule B is used for reporting TDS on applicable immovable property transfers.

Therefore, property buyers should distinguish between the TDS obligation and the TAN requirement. From 1 October 2026, TAN compliance becomes simpler for the specified resident individual/HUF property transactions, while the applicable TDS deduction and reporting obligations continue.

Official Sources

• Income Tax Department
• Income Tax Department – Form 141 FAQs
• Income Tax Department – Form 141 User Guide
• Union Budget – Memorandum Explaining Provisions