Why the buyer deducts the tax.
Indian law makes the buyer of property collect part of the seller's tax, by deducting TDS from the price and paying it to the government. This applies whether you live in India or the UK, and whether you pay from an Indian or a foreign account.
From 1 April 2026 these rules sit in section 393 of the Income-tax Act, 2025. The rates and the ₹50 lakh limit for resident sellers are unchanged, but the forms have new numbers.
| Seller is resident in India | Seller is an NRI | |
|---|---|---|
| When TDS applies | Price or stamp duty value of ₹50 lakh or more | On any amount, no lower limit |
| Rate | 1% of the amount paid | 12.5% plus surcharge and cess on long-term sales; about 30% plus on short-term |
| Calculated on | Full amount paid | Full amount paid, unless the seller has a lower TDS certificate |
| TAN needed by buyer | No, PAN-based | Yes, under the current rules |
| Form to pay and report | Form 141 (was 26QB) | Challan, then quarterly Form 140 (was 27Q) |
| Certificate to seller | Form 132 (was 16B) | Form 131 (was 16A) |
Buying from a resident seller.
If the seller lives in India and the price or stamp duty value is ₹50 lakh or more, you deduct 1% from every payment, including advances and instalments, and pay it with Form 141. Form 141 combines the challan and the statement in one PAN-based form, so you do not need a TAN.
- Which amountTDS is worked out on the higher of the price paid and the stamp duty value.
- Joint buyers or sellersThe ₹50 lakh limit is checked on the total price, and each buyer files for their own share.
- When to payWithin 30 days from the end of the month in which you deducted the TDS.
- CertificateDownload Form 132 from TRACES once Form 141 is processed and give it to the seller.
- Agricultural landRural agricultural land is outside this rule.
- Seller's PANIf the seller does not have a valid, operative PAN, a higher rate applies.
Buying from an NRI seller.
If the seller lives abroad, including in the UK, the rules are much stricter. You must deduct TDS at the seller's capital gains rate on the whole price, unless the seller gives you a lower TDS certificate. You need a TAN, must deposit the tax by challan and file a quarterly TDS return.
If too little TDS is deducted from an NRI seller, the department can recover the shortfall, interest and penalties from the buyer. Always ask the seller for their residential status and, if possible, a lower TDS certificate before you pay.
The government has announced plans to make TDS on purchases from NRIs simpler and PAN-based. We check the position in force on the date of your purchase.
If you are buying from the UK.
The same TDS duty applies to you as to a resident buyer. Living abroad does not remove it.
TDS can be paid from your NRO or NRE account through net banking.
Keep the TDS certificate and payment proofs with your purchase deed. They matter when you sell later.
How we handle your property TDS.
Confirm the seller's status
Resident or NRI, PAN status and whether they hold a lower TDS certificate.
Work out the TDS
For every payment, including advances, on the higher of price and stamp value.
File Form 141 or the challan
Within the deadline, from your Indian account.
Quarterly return for NRI sellers
Form 140 with correct seller details and treaty or certificate rates.
Issue the certificate
Form 132 or Form 131 to the seller, so they can claim credit.
What happens if TDS goes wrong.
Interest of 1% a month for not deducting and 1.5% a month for deducting but not paying on time.
A daily late fee applies for each day the form or statement is late.
For NRI sellers, the buyer can be treated as in default for the full amount not deducted.
Documents for property TDS.
- Sale agreement and payment schedule
- Stamp duty value
- Payment dates and amounts
- Seller's PAN and address
- Residential status confirmation
- Lower TDS certificate, if any
- Your PAN
- Indian bank account details
- TAN, if buying from an NRI
Why NRIs in the UK choose us for India tax.
We work with the India side of your tax while keeping your UK Self Assessment and treaty position in view.
Every computation is checked by a second Chartered Accountant before anything is filed.
A written scope and fee before work starts, with no surprise charges later.
Encrypted document sharing and e-verification, so nothing needs a trip to India.
Returns, TDS refunds, FEMA questions and property sales handled by the same team.
Clear explanations of what you owe, why, and what to keep for next year.
Property TDS help for buyers across the UK.
We handle TDS on Indian property purchases for buyers living throughout the UK, whether you are buying a flat for family, an investment or a home to return to.
London
South East
Midlands
North of England
East and South West
Scotland, Wales, NI
TDS on purchase of property FAQs.
Buying property in India from the UK?
Send us the agreement and seller details. We will work out and file the TDS for every payment.
This page is general guidance based on Indian income-tax and FEMA rules as they stand, including the Income-tax Act, 2025 that applies from 1 April 2026. It is not legal or financial advice for your situation. Rates, limits and deadlines can change, so please speak to us before acting on it.