TDS on Purchase of Immovable Property in case of Co Owner

Save Share

This query is : Resolved

Quick Summary

This discussion clarifies the rules for Tax Deducted at Source (TDS) when purchasing immovable property as a co-owner. If the total property value is below the £50 lakh threshold, TDS is not applicable. However, if the property value exceeds £50 lakh, each co-owner must deduct TDS on their proportionate share of the payment and file separate challans (Form 26QB) for their respective transactions.

Disha Pania

Disha Pania (Querist)

03 April 2025 My Mother and I are co-owners of the Property (Rs 6,00,000/-): My Mother owns 90%(5,40,000/-), and I own 10% (60,000/-). I am paying my 10% (60,000/-) Payment to the Seller by Deducting 1% (600/-) from it. Do I have to prepare two Challans? (Mother & mine on Pro-rata basis, i.e 90% & 10%) or only mine.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

03 April 2025 Whenever mother pays any amount to seller she has to deduct TDS & pay balance.
TDS is deducted over the purchase of property, when the property value is equal to or more than 50 lakhs; not otherwise.

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)

04 April 2025 As per Section 194-IA of the Income-tax Act, TDS at 1% is required to be deducted if the total sale consideration of the property exceeds Rs. 50 lakh.

Now, let’s analyze your case:

Total Property Value = Rs. 6,00,000/-

Your Mother's Share (90%) = Rs. 5,40,000/-

Your Share (10%) = Rs. 60,000/-

Since the total sale consideration is only Rs. 6,00,000, which is well below the Rs. 50 lakh threshold, TDS under Section 194-IA is NOT required.

Even though you want to know the reply will be:

Yes, in your case, since both you and your mother are co-owners of the property and are making payments separately, TDS under Section 194IA (1% on property transactions exceeding Rs. 50 lakh) should be deducted separately by each buyer for their respective share of the property purchase price.

Thus, two separate challans (Form 26QB) should be prepared:

One challan for your mother, covering 90% of the payment (Rs. 5,40,000), with a TDS deduction of Rs. 5,400.

Another challan for you, covering your 10% payment (Rs. 60,000), with a TDS deduction of Rs. 600.

This is required because Form 26QB is to be filed separately for each buyer-seller combination.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now