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guest: I had negotiated to sell my house and the buyer had deposited TDS on the sale amount. It is reflected in my 26AS. However, due to some complications, the deal has been called off. Please advise what I have to do to get the refund or adjust in my Tax due for this FY 25-26.
:
Since the amount of TDS deducted by the buyer is reflected in your form No. 26AS, you can claim the refund of the same while filing your regular income tax return. You need to claim this for the financial year 2025-2026.
guest: Is TDS @ 1% deductible on property purchased through bank e-auction?
:
As per my reading of the provisions of Section 194IA the buyer of any immovable property has to deduct tax at source @ 1% in case consideration of the property exceeds Rs. 50 lacs. No exception has been provided under the law for purchase of property under e-auction, so you will have to deduct the TDS @ 1% at the time of payment of the money to the bank.
guest: If the seller is not ready to give credit for 1% TDS to the buyer at the time of transfer of the property what buyer can do legal action? and 2. What will be the impact if this tax is not paid by any party ?
:
Since the TDS is treated as taxes paid on behalf of the seller, the seller has to give credit for the same. As far as legal remedy for the seller not giving the credit is concerned, no legal remedy are provided under the income tax laws. You can involve the broker involved in the deal to convince the seller to come to sense and give the credit in respect of TDS.
guest: My father in law had a property (residential house of 1000 yards) in Chandigarh. He had 8 children. After his death my wife got 1/8th share in 2015. She died in 2017 and after her death, ownership rights of her share was transferred to me and my two sons. Now we have sold our shares for Rs 1crore & 1 lakh and received Rs 34 lakh each app. From the deal Rs 101000 was deducted and deposited as TDS (income tax) in the form 26 QB (16 B). What are the tax liabilities by each, on the sold share of the house and amount Rs 34 Lakh received by each. In which manner the amount is to be utilized. Is TDS deposited is refundable and how and which IT Return form is needed for it to be submitted.
:
Since you had 1/3 share of your share in the property sold, the 1/3 share of the long term capital gains will become taxable in your respective hands. In case your father in law had bought or constructed the property prior to 1-4-2001 the proportionate market value of the property can be taken as your cost and if was acquired after that date then the proportionate cost actually incurred by him will be your cost for capital gains. If you want to avail exemption from payment of long term capital gains either you can invest the capital gains for buying or constructing a house or by investing the capital gains in capital gains bonds. If you do not wish to avail the exemption, you have option to pay tax at 20% on indexed long term capital gains or @ 12.50% on plain gain. You will get credit for your share in the TDS amount.
bikasbaba: We are five Central Government permanent employees, all posted in the same metro city. We plan to jointly purchase a plot of land and construct a five-storey residential building for our personal end use, based on common mutual understanding. We have finalised a suitable plot and approached PSU banks for a home loan to fund land purchase and construction. However, banks refused the loan as we are not blood relatives. We are serious buyers seeking guidance on arranging funds at suitable ROI.
:
Yes, the banks are not willing to lend in case the joint owners are not blood relatives as they do not want to get involved in the litigation if it arises in future. You can explore the possibility of forming a cooperative housing society for this purpose.
guest: I am a senior citizen. I regularly file my ITR. I had booked a flat for which possession will be given in 2027. During the year 2025-2026 I have paid Rs. 50 Lakhs to the builder and TDS was deducted at the rate of 1% on the amount paid. In which column of ITR-2 It has to be shown this TDS and payment to the builder?
:
The TDS is deducted by you on the amounts paid to the builder, for which the builder will get the credit against his tax liability. The same can not be shown in your income tax return as you will not get any credit for the tax deducted and deposited by you. This should be recovered from the builder so you need to pay the builder that much less towards cost of the flat. The amount of TDS has been paid by you on behalf of the builder which you can recover from him.
guest: My friend had Purchased a Residential property of more than 50 lakhs in June-2026. There were two Joint Sellers and Two Joint Buyers in Agreement. TDS was correctly deducted in the transaction and paid with the bank also. Mistake was that we had deposited TDS through only one challan (26QB) i.e. mentioning only First Seller and First Seller instead of paying 50% TDS in the name of both sellers and from both buyers. How can i get it corrected/any solution for the same.
:
Though there is provision for correction of some fields in the form 26QB but there is no provision for transferring the TDS money from one buyer/seller to another buyer/seller. So in my opinion the option left to you is to claim refund of the excess TDS from the first seller and pay the same through the PAN of the second buyer mentioning the PAN of the Second seller.
guest: One of my friends bought a property from an NRI but missed to deduct tax before registration. We confirmed from the seller that there is no capital gain from the property. What step should we take to avoid any loss?
:
When a property is purchased from an NRI, TDS is required to be deducted on the payment made to the non resident under Section 195. The buyer has to deduct TDS at 12.50% in case of long-term capital gains and 30% in case of short-term capital gains. This TDS is deducted on the capital gains arising to the NRI from the sale of the property. It is recommended that you obtain an undertaking from the seller about his residential status and that there are no capital gains arising to him from the transactions on which was tax is required to be paid.
guest: I want to buy a residential property from a non-resident Indian who lives in the US. Should I deduct tax while making payment?
:
Yes, as per Section 195 of the Income Tax Act, any person who is responsible for making payment of any sum to a non-resident which is chargeable to tax has to deduct tax at the rates in force. The TDS is on the amount chargeable to tax and not on the whole amount. So you can request the seller to provide you with the documents for cost of purchase with year like his purchase agreement with the help of which you can arrive at the taxable capital gains. In case the property is held by the non resident for more than two years you can apply cost inflation index to his cost and compute tax at 12.50 % else you will have to deduct tax at 30% of the difference between sale and purchase price.
guest: I am selling my small flat and buying a bigger flat, investing sale proceeds and some additional money, from an NRI. What is the tax procedure for capital gain and TDS etc.?
:
Under Section 54 of the Income Tax Act, a person can claim exemption from long term capital gains arising from sale of a residential house by investing the capital gains in another residential house property. Since you are investing the entire sale proceeds in new residential flat, you can claim the exemption under section 54 for full long term capital gains. The exemption can be claimed while filing the ITR You will have to deduct tax at source on payment to be made to the Non-resident at 12.50 % and deposit the same with income tax department if the NRI had held the house for more than 2 year else 30%. I would advise you to take help from a practicing Chartered Accountant.
guest: If a residential flat is purchased from the builder for Rs. 1 Cr. Whether the provisions of TDS are applicable if the property is purchased in the name of 4 co-owners?
:
As per the provisions of TDS on sale of immovable property, the seller has to deduct TDS @ 1% on the sale consideration in case the value of the property is 50 lacs or more. So the liability to deduct TDS will arise as the total value of the property is more than 50 lacs. In case of joint owners every joint owner will have to deduct TDS in the ratio in which they are paying for the property. Please note that the joint owners will have to deduct TDS even if share of each joint owner may be lower than 50 lacs each if the sale consideration of such property is 50 lacs ore more.
guest: I am purchasing a house property from joint owners. First owner is an NRI and the 2nd owner is an Indian resident. Sale consideration is 58 Lakhs. I need to pay 50% to each seller. I know that I can deduct 1% TDS on Resident Indian but I am a little bit confused about the NRI joint owner. Please guide me.
:
The provision of deduction of tax @ 1% under Section 194-IA for purchase of a property is applicable when the seller is a resident and the value of the property exceeds Rs. 50 lakhs. In your case as far as a resident Indian is concerned you can discharge your liability by deducting tax @ 1% on 29 lakhs. As far as the non-resident co-owner is concerned you are required to comply with provisions of Section 195 of the income tax act which cast a duly on the person paying the money to the non-resident to deduct tax at source at the rates in force. For the long term capital gains the tax rate is 12.50% on the long term capital gains. If you can get the relevant documents for working out the taxable income based on the cost of pur-chase and date of purchases etc. and work out the tax liability, you need to deduct tax at 12.50% on such taxable capital gains in case the property was held for more than two years by the seller. In case the hold-ing period is less than 2 years you will have to deduct tax @ 30%. In case the seller is unwilling to share the documents you will have to deduct tax at these rates on whole of the amount being paid.
