TDS u/s 194-IA Calculator
Estimator under Section 194-IA of the Income-tax Act, 1961. The threshold is tested on the higher of the consideration and the stamp-duty value. Where the value is below Rs 50 lakh no TDS is deducted. Confirm the seller's residential status and PAN before releasing payment.
When you buy an apartment in Odisha for Rs 50 lakh or more, you do not simply pay the seller and register the deed. The law makes you a tax collector for one transaction. Under Section 194-IA of the Income-tax Act, 1961, the buyer must deduct 1% of the consideration or the stamp-duty value, whichever is higher, deposit it with the government and hand the seller a certificate. Miss the step and the consequence falls on you, not on the seller. A TDS 194-IA calculator tells you the exact figure to deduct before you release the payment.
This page explains the charge, the threshold, the forms and the timelines, and shows how the TDS 194-IA calculator below turns the two values, consideration and stamp-duty value, into the amount to be withheld. The provision is being re-enacted as Section 393(1) of the Income-tax Act, 2025 with effect from 1 April 2026, but the framework is unchanged, so this guide refers to the familiar Section 194-IA of the 1961 Act throughout.
- Rate: 1% of the consideration or the stamp-duty value, whichever is higher.
- Threshold: Rs 50 lakh. Since 1 October 2024 the threshold is tested on the aggregate value across all co-buyers and co-sellers.
- The 1% applies to the whole amount, not just the slice above Rs 50 lakh.
- No PAN from the seller means the rate jumps to 20%.
- Deposit within 30 days of the end of the month of deduction using Form 26QB; issue Form 16B within 15 days.
- Use the TDS 194-IA calculator below to get the deduction on your figures, then file Form 26QB on time.
1. What Section 194-IA requires of a buyer
Section 194-IA is a tax-deduction provision aimed at the sale of immovable property. It applies where a person buys immovable property, other than agricultural land, from a resident seller for a consideration of Rs 50 lakh or more. The buyer becomes the deductor: the buyer must set aside 1% of the consideration or the stamp-duty value, whichever is higher, and pay that amount to the government instead of the seller. The seller receives the net amount and claims credit for the tax deducted when filing their return.
The provision is unusual in that it does not need a Tax Deduction Account Number, or TAN, in the ordinary case. The buyer uses their own PAN to file the statement and the seller's PAN to identify the deductee. That simplification is what makes the compliance workable for ordinary home buyers, who would otherwise have to obtain a TAN for a single transaction.
1.1 Who is a buyer for this purpose
Any person buying the property is a buyer: an individual, a company, a firm, a Hindu undivided family or any other person. There is no exemption for a first-time buyer or for a buyer who is purchasing a single residential unit. If you are buying a flat in Bhubaneswar for Rs 60 lakh, you are a deductor for that transaction, and the obligation attaches to you personally.
1.2 What "immovable property" covers
The provision covers immovable property other than agricultural land. A residential apartment, a house, a commercial shop, an office, a plot of non-agricultural land and a building of any kind all fall within it. Agricultural land is excluded, so the purchase of agricultural land does not attract TDS under this section.
2. The 1% rate and the Rs 50 lakh threshold
Two figures decide everything: the rate and the threshold. The rate is 1% of the consideration or the stamp-duty value, whichever is higher. The threshold is Rs 50 lakh. Both are tested, and if either the consideration or the stamp-duty value reaches Rs 50 lakh, the deduction applies to the higher of the two figures.
| Element | Rule |
|---|---|
| Rate | 1% of the consideration or the stamp-duty value, whichever is higher |
| Threshold | Rs 50 lakh, tested on both the consideration and the stamp-duty value |
| Base for the 1% | The entire amount, not merely the portion above Rs 50 lakh |
| Aggregation | From 1 October 2024, the threshold is tested on the aggregate value across all co-buyers and co-sellers |
| No PAN | Rate rises to 20% where the seller does not furnish a valid PAN |
| Non-resident seller | Section 194-IA does not apply; Section 195 governs |
The most misunderstood point is the base. A property bought for Rs 70 lakh does not attract 1% of Rs 20 lakh, the amount above the threshold. It attracts 1% of the full Rs 70 lakh, which is Rs 70,000. The threshold is a switch, not a slab: once crossed, the whole value is taxed. The TDS 194-IA calculator applies the rate to the higher of the two values and shows the result.
Before October 2024, a buyer could sometimes avoid TDS by splitting a single purchase between several co-buyers so that no individual consideration crossed Rs 50 lakh. That route is closed. Since 1 October 2024 the threshold is tested on the aggregate value of the property across all co-buyers and co-sellers, so splitting a deal no longer avoids the deduction.
3. Working out the base: consideration versus stamp-duty value
Section 194-IA does not let you choose the lower figure. It requires you to take the higher of the consideration and the stamp-duty value. In many Odisha transactions the two are close, but they can diverge for good reasons, and when they do, the higher figure governs the deduction.
The consideration is what you actually agree to pay the seller under the sale deed. The stamp-duty value is the value on which the stamp duty is assessed, which is ordinarily the higher of the consideration and the government benchmark or circle value for the locality. If the deed recites a price below the benchmark value, the stamp duty is assessed on the benchmark value, and for TDS purposes the stamp-duty value will be that higher figure. The practical lesson is that under-declaring the price in the deed does not reduce the TDS; it increases the base. Enter both figures in the TDS 194-IA calculator and it will take the higher one for you.
4. The 20% rate when the seller has no PAN
If the seller does not furnish a valid Permanent Account Number, the rate of deduction is not 1% but 20% of the consideration or the stamp-duty value, whichever is higher. This is a penal rate designed to discourage transactions outside the tax net, and it applies regardless of the seller's intentions. The buyer must therefore collect the seller's PAN before making any payment.
A missing or invalid PAN is the single most expensive mistake in this area. On a Rs 80 lakh flat, the difference between 1% and 20% is Rs 15.2 lakh, the difference between a routine deduction and a dispute. Verify the PAN on the Income Tax Department's online facility before the first payment, and keep a copy with the deed papers.
5. Forms and timelines
Three dates matter after the deduction. The tax must be deposited, the statement must be filed, and the certificate must be issued. Each has its own form and its own deadline, and the buyer carries the consequence of a lapse.
- Deposit within 30 days from the end of the month in which the deduction is made.
- File Form 26QB on the Income Tax e-filing portal; from April 2026 the corresponding form under the Income-tax Act, 2025 is Form 141.
- Issue Form 16B (Form 132 under the new Act) to the seller within 15 days of the deposit.
- No TAN is required where the seller is a resident.
- Keep the challan and the acknowledgement with the sale deed and the payment receipts.
If you are unsure which figure to enter, the TDS 194-IA calculator handles the comparison: give it the consideration and the stamp-duty value and it selects the base. The forms are filed online, and the portal generates the certificate once the statement is processed. The seller needs Form 16B to claim credit, so a buyer who delays the certificate delays the seller's return. It is good practice to file the statement as soon as the payment is made rather than waiting for the 30-day window to close.
6. Under-construction instalments and co-buyers
Where you buy an under-construction flat on a construction-linked plan, the payments are spread over the life of the project. If the total price is Rs 50 lakh or more, TDS is deducted at 1% on each instalment as it is paid, and a separate Form 26QB is filed for each deduction. The instalments are not clubbed into one deposit at the end.
A buyer paying an instalment can run the TDS 194-IA calculator on the instalment figure and on the total price to see both the per-instalment deduction and the overall exposure. Where there are co-buyers, each buyer deducts on their own share of the consideration, but the threshold is tested on the aggregate value of the property. A family that buys a Rs 60 lakh flat in two names cannot argue that each share is below Rs 50 lakh; the aggregate value crosses the threshold and the deduction applies.
7. Worked examples using the TDS 194-IA calculator
7.1 A straightforward resale
You buy a resale flat in Cuttack for Rs 70 lakh, and the stamp-duty value is Rs 72 lakh. The consideration is Rs 70 lakh and the stamp-duty value is Rs 72 lakh, so the base is the higher figure, Rs 72 lakh. The seller has furnished a PAN, so the rate is 1%. The deduction is Rs 72,000, and the seller receives Rs 69,28,000. Enter these figures and the TDS 194-IA calculator returns exactly that.
7.2 A purchase below the threshold
You buy a plot for Rs 45 lakh with a stamp-duty value of Rs 44 lakh. The higher of the two is Rs 45 lakh, which is below the Rs 50 lakh threshold, so no TDS is deductible. The calculator shows the base and the rate but returns a deduction of zero, with a note that the transaction is below the threshold.
7.3 A seller without a PAN
Now suppose the same Rs 70 lakh flat is bought from a seller who has not furnished a PAN. The base is unchanged, but the rate moves to 20%. The deduction is Rs 14,40,000 on a Rs 72 lakh base. This is the scenario the penal rate is designed to prevent, and it is why the PAN should be verified before the first rupee changes hands.
8. When the seller is a non-resident
Section 194-IA applies only to a resident seller. If the seller is a non-resident, the purchase is governed by Section 195, and the rules change in three important ways. There is no Rs 50 lakh threshold, so the deduction applies to any value. The buyer must obtain a TAN. And the rate is not a flat 1% but the rate applicable to the seller's capital gain, which can be substantially higher. The buyer files Form 27Q, and a certificate for lower or nil deduction from the Assessing Officer is often needed. This is a case where professional advice before the payment is not optional.
9. Common mistakes and how to avoid them
Deducting 1% only on the amount above Rs 50 lakh.
The 1% applies to the entire consideration or stamp-duty value, whichever is higher. The threshold is a switch, not a slab.
Using the consideration when the stamp-duty value is higher.
The base is the higher of the two. Check the benchmark value before deciding the base.
Waiting for the end of the project to deposit TDS on instalments.
Deduct on each instalment and file a separate Form 26QB within 30 days of the end of the month of each deduction.
Assuming a family split avoids the threshold.
Since 1 October 2024 the threshold is tested on the aggregate value across all co-buyers and co-sellers.
10. TDS and the other costs of a property purchase
TDS is one of several charges on a property purchase and should be planned alongside them. On the same transaction you will pay stamp duty of about 5% of the higher of the consideration and the benchmark value (4% for a woman purchaser), a registration fee of about 2%, and, if the flat is under-construction, GST at 1% or 5%. A buyer who budgets only for the price and the stamp duty will be short at the closing table.
The firm's other calculators cover these in turn. The stamp duty and registration calculator estimates the duty; the GST on apartments calculator classifies an under-construction flat; and the capital gains calculator helps a seller work out the tax on the gain, on which the TDS is only a part-payment.
11. Key takeaways
- Deduct 1% of the consideration or the stamp-duty value, whichever is higher, once Rs 50 lakh is crossed.
- The 1% applies to the whole amount, not just the slice above the threshold.
- Since 1 October 2024 the threshold is tested on the aggregate value across co-buyers and co-sellers.
- No PAN from the seller means 20%, so verify the PAN before the first payment.
- Deposit within 30 days of the end of the month of deduction using Form 26QB, and issue Form 16B within 15 days.
- A non-resident seller moves the transaction to Section 195, with no threshold and a higher rate.
12. Frequently asked questions
What is Section 194-IA of the Income-tax Act?
It requires a buyer of immovable property, other than agricultural land, to deduct tax at source at 1% of the consideration or the stamp-duty value, whichever is higher, when that value is Rs 50 lakh or more, and to deposit it using Form 26QB. From 1 April 2026 the provision is re-enacted as Section 393(1) of the Income-tax Act, 2025.
At what value does TDS under 194-IA apply?
When the consideration or the stamp-duty value is Rs 50 lakh or more. Both are tested and the higher is used. Since 1 October 2024 the threshold is tested on the aggregate value across all co-buyers and co-sellers.
Is TDS deducted on the whole amount or only above Rs 50 lakh?
On the entire consideration or stamp-duty value, whichever is higher. A Rs 70 lakh flat attracts 1% of Rs 70 lakh, which is Rs 70,000, not 1% of Rs 20 lakh.
What is the TDS rate if the seller does not give a PAN?
The rate rises from 1% to 20% of the consideration or stamp-duty value, whichever is higher. Always collect and verify the seller's PAN before making a payment.
Which form is used to deposit TDS under 194-IA?
Form 26QB, filed on the Income Tax e-filing portal within 30 days of the end of the month of deduction. From April 2026 the corresponding form is Form 141. The buyer then issues Form 16B (Form 132 under the new Act) within 15 days.
Does TDS apply to a resale flat?
Yes. Section 194-IA applies to the purchase of immovable property from a resident seller generally, so it covers resale flats as well as new flats. Agricultural land is excluded.
How is TDS handled on under-construction instalments?
Deduct 1% on each instalment as it is paid and file a separate Form 26QB for each deduction within 30 days of the end of the month of deduction.
What happens if the seller is a non-resident?
Section 194-IA does not apply. Section 195 governs: there is no Rs 50 lakh threshold, the buyer must obtain a TAN, deduct at the applicable capital-gains rate and file Form 27Q.
13. Related guides
These firm guides and tools cover the tax and legal context around a TDS estimate on a property purchase.
14. Official sources and verification
Official sources
The obligation to deduct tax on the purchase of immovable property is set out in Section 194-IA of the Income-tax Act, 1961, re-enacted as Section 393(1) of the Income-tax Act, 2025 from 1 April 2026. The forms, the deposit timelines and the certificate procedure are prescribed by the Income Tax Department and administered through the e-filing and TIN-NSDL portals.
You can read the department's guidance on the Income Tax e-filing portal and the statement-filing facilities on the TIN-NSDL website. The firm's Odisha Land and Property Law Knowledge Centre explains the buying process around these numbers, and you can reach the firm through the contact page for advice on a specific transaction.
TDS under Section 194-IA is a small percentage with a large compliance tail. Work out the figure with the TDS 194-IA calculator before you release payment, verify the seller's PAN, file the statement on time and hand over the certificate, and the deduction stays what it should be: an ordinary step in an ordinary purchase, not a liability that follows you for years.
