TDS on sale of immovable property in case of NRI seller

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This discussion clarifies the process for deducting Tax Deducted at Source (TDS) when purchasing immovable property from a Non-Resident Indian (NRI). It explains the transition from a TAN-based system to a new PAN-based system for reporting and depositing TDS, effective from October 1, 2026. The guide covers the relevant forms (Form 141 for the new system, Form 144 for older transactions), applicable TDS rates, and the implications of not having a Tax Registration Number (TRN) or Permanent Account Number (PAN).

Sulafa S.V

Sulafa S.V (Querist)

16 April 2026 Dear Sir/Madam,
I have purchased an immovable property from an NRI. I would like to know how to deduct TDS in this case. I have already registered for a TAN on the Income Tax portal; however, I am unable to find the option related to the sale of immovable property.
Could you please guide me on how to proceed?

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

16 April 2026 According to the Income Tax Department, from FY 2026-27, the rules are transitioning to a PAN-based system to simplify compliance for individual buyers. The buyer must report the transaction by filing the Non-Resident Quarterly TDS Return using the new Form No. 144 (which replaces the old Form 27Q).
Refer::

https://www.taxheal.com/nri-tds-payment-on-sale-of-property.html#:~:text=Under%20the%20new%20Income%2Dtax,NRI%20cannot%20use%20Form%20141.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

14 November 2026 Update: the process changed on 1 October 2026.

Before 1 October 2026
• The resident buyer needed a TAN, deposited TDS through a TAN-based challan and filed Form 144 (which replaced Form 27Q).

From 1 October 2026
• A resident individual or HUF buyer can deposit and report the TDS using PAN through Form 141 (Schedule E), without a TAN. This follows the Finance Act 2026 amendment to Sec 397(1)(c) and the Income-tax (Fifth Amendment) Rules, 2026.

Rate and base
• Sec 393(2) [Table Sl. No. 17], on the full consideration. Long-term: 12.5% plus surcharge and cess. Short-term: slab rates. The seller can obtain a lower deduction certificate.
• The Rs 50 lakh threshold does not apply to a non-resident seller.
• If the seller has no PAN, give the TRC and TIN, otherwise a higher rate applies.

Your April 2026 purchase
• That fell under the TAN route. If TDS has not been deposited, deposit it now with interest (1% / 1.5% per month) and file Form 144. A late fee applies.
• Issue the TDS certificate to the seller. Keep the sale deed, payment proofs and challans together.

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