NRI Property Purchase TDS Rules: From October 1, 2026, resident individuals and Hindu Undivided Families (HUFs) buying property from a non-resident won’t need a separate Tax Deduction and Collection Account Number (TAN) only for the TDS process. CBDT has brought a new PAN-based system through amended Form 141. The change was notified on September 22, 2026 and will apply from October 1.
What Changes From October 1
Under the new system, buyers can use their PAN to report and deposit TDS through Form 141. A new Schedule E has been added for property purchases from non-resident sellers. It will collect details such as the property, buyers and sellers, sale value, stamp duty value, payment instalments, TDS rate and tax deducted. Overseas address, Tax Residency Certificate and foreign Tax Identification Number details may also be needed.
Social Security Changes 2027: Tax, Benefits And COLA Proposals Explained
Buyers will also have to give Form 132 to the non-resident seller as the TDS certificate. The Income Tax Department says Form 132 is a mandatory certificate after TDS has been deducted and deposited.
“This is a welcome compliance reform for resident individuals and HUFs buying property from non-resident sellers,” said Alay Razvi, managing partner, Accord Juris.
“Buyers must still correctly determine the seller’s residential status, deduct tax at the applicable rate, deposit it within the prescribed timeline and issue the required TDS certificate,” he said.
How The New TDS Process Will Work
The buyer will now use PAN-based Form 141 instead of getting a separate TAN just for this transaction. Schedule E will contain the transaction details and the TDS information. Where there are instalments, details of earlier and current payments will also have to be entered. Each deductor has to file separately where there are multiple buyers.
Harsh Khabar, advocate, Delhi High Court, said the old process added another step for individual buyers.
“TAN being a separate number specifically required for deducting and reporting TDS, created an additional compliance step for an individual buyer, whereas PAN is the buyer’s existing tax identification number,” Khabar said.
Supriya Majumdar of Elarra Law Offices said buyers earlier had to apply for and manage a TAN even for a one-time purchase. Kunal Savani of Cyril Amarchand Mangaldas said the new challan-cum-statement route can make cross-border property deals easier.
“Overall, this is a welcome and practical step that eases cross-border property transactions while still keeping them within the tax net,” Savani said.
Tax Duty Still Remains
The easier paperwork doesn’t remove the TDS duty. Buyers still have to check that the seller is a non-resident, calculate the applicable tax and deposit it on time. They also need to collect the seller’s foreign tax and contact details where required.
US Midterm Elections 2026: How They Could Affect Taxes, Social Security and Retirement
Shashank Agarwal of Legum Solis said buyers must still check title, ownership, stamp duty and other legal matters. Anam Khan of PSL Advocates & Solicitors also said the amendment mainly cuts the procedural burden.
