NRI Property Purchase TDS Changes – October 2026

This document covers

1. What Has Changed from 1 October 2026?
2. Who Can file Form 141 - Schedule E?
3. Rate of TDS on Property Purchased from a Non-Resident (NRI)
4. Details required for filing Form 141 – Schedule E
5. Due Date for Form 141 – Schedule E
6. Other Important Points

1. What Has Changed from 1 October 2026?

• No TAN Requirement: Resident buyers can use their PAN instead of TAN for deducting TDS on property purchase from non-residents.
• Simplified Filing: Resident buyers can use Form 141- Schedule E instead of complex Form (144/27Q)
• PAN based filing: TDS can be reported and paid through the prescribed process using the buyer PAN Income Tax login
• TDS obligations continue: Buyers must deduct tax at the applicable rate and comply with the prescribed payment and filing deadlines.

2. Who Can file Form 141 - Schedule E?

Any resident individual or HUF purchasing property from any non-resident is required to file Form 141-Schedule E w.e.f 01st October 2026

Until 30th September 2026, any resident individual or HUF purchasing a property from any non-resident is required to file Form 144/27Q

3. Rate of TDS on Property Purchased from a Non-Resident (NRI)

The TDS must be deducted depending on the applicable tax provisions, the nature of the transaction and any valid lower or nil deduction certificate.

• LTCG -12.5% + surcharge+ education cess w.e.f 2rd July 2024
• STCG-30%+ surcharge+ education cess

For example, if the buyer is purchasing long term immovable property resulting in LTCG for seller, the buyer is required to deduct TDS 12.5%+ surcharge +education cess. Rate of Surcharge depends on the property value.

4. Details required for filing Form 141 – Schedule E

• Full Address of the property purchased
• Date of agreement
• Total Stamp Duty Value of Property
• Total sale Consideration of property
• Seller Name, PAN
• Seller's Address in the country outside India
• Seller's tax identification number outside India
• Total amount on which TDS is deducted

5. Due Date for Form 141 – Schedule E

The Due date of filing Form 141-Schedule Eis within 30 days from the end of month in which the tax deduction is made.

For example, Mr Ram has paid the amount of Rs 10 lakhs to Mr James NRI in USA in the month of October 2026 for purchase of immovable property, he needs to file form 141-shcedule E by November 30, 2026.

6. Other Important Points

6.1 TDS on instalment payments

If the property purchase amount is paid in instalments, the buyer must deduct TDS at the applicable rate on each payment, as required. Form 141 - Schedule E should be filed for the relevant month of TDS deduction. Separate forms may be required for payments made in different months.

6.2 Multiple buyers or multiple sellers

• If a property has multiple buyers, each buyer needs to file separate Form 141- Schedule E.
• If a property has multiple sellers, each buyer can include multiple sellers in single form 141-schedule E

6.3 Lower or nil TDS certificate

If the NRI seller has obtained a valid lower or nil deduction certificate under the applicable provisions, the buyer should verify its validity and conditions before applying the TDS rate. The buyer us required to provide the lower deduction certificate number while filing Form 141-schedule E

6.4 What if the NRI seller does not have a valid PAN?

Buyers should not assume that the usual rate will apply if the seller’s PAN is unavailable or invalid. The buyer is required to TDS at higher rates (20%) if the seller PAN is not valid

6.5 What Happens After Filing Form 141-Schedule E?

After successfully filing Form 141-Schedule E and paying the TDS, the buyer should save the acknowledgement and challan receipt for future reference.

Once the form is processed, the buyer can download the TDS certificate in Form 132 (Form 16A earlier) from the TRACES portal and provide it to the NRI seller within the prescribed time limit.