{"id":3507,"date":"2025-10-12T15:20:00","date_gmt":"2025-10-12T15:20:00","guid":{"rendered":"https:\/\/www.varmahomes.com\/blog-manager\/?p=3507"},"modified":"2025-10-10T12:27:23","modified_gmt":"2025-10-10T12:27:23","slug":"step-by-step-guide-to-tds","status":"publish","type":"post","link":"https:\/\/www.varmahomes.com\/blog-manager\/step-by-step-guide-to-tds\/","title":{"rendered":"Step-by-Step Guide to TDS on Buying Apartments in Kochi"},"content":{"rendered":"\n

When buying an apartment in Kochi, one important financial aspect that often gets overlooked is the deduction of TDS (Tax Deducted at Source) on property purchases. Understanding how TDS works is crucial for every homebuyer to ensure compliance with income tax regulations and avoid penalties. For those exploring real estate investment strategies in Kochi<\/a><\/strong>, being aware of the TDS process not only ensures smoother transactions but also enhances your overall financial planning while investing in property.<\/p>\n\n\n\n

<\/p>\n\n\n

What is TDS on Property Purchase?<\/h2>\n\n\n

TDS (Tax Deducted at Source) is a mandatory tax deduction applicable when a property is purchased for \u20b950 lakh or more. According to Section 194-IA of the Income Tax Act, the buyer must deduct 1% of the total sale value as TDS before making payment to the seller. This amount is then deposited with the government on behalf of the seller.<\/p>\n\n\n\n

This rule applies whether you are buying a new flat from a builder or a resale property from an individual. However, TDS is not applicable if the transaction value is below \u20b950 lakh or if the property is agricultural land.<\/p>\n\n\n\n

Step 1: Determine if TDS is Applicable<\/strong><\/p>\n\n\n\n

Before proceeding with your apartment purchase, check the total consideration value mentioned in your sale agreement. If it exceeds \u20b950 lakh, you are required to deduct TDS at 1% of the transaction amount.<\/p>\n\n\n\n

For example, if you are purchasing a flat worth \u20b970 lakh, you must deduct \u20b970,000 (1% of \u20b970 lakh) as TDS and pay \u20b969,30,000 to the seller.<\/p>\n\n\n\n

Step 2: Collect Seller\u2019s PAN Details<\/strong><\/p>\n\n\n\n

It\u2019s essential to collect and verify the seller\u2019s PAN (Permanent Account Number) before making the payment. The PAN of both the buyer and the seller must be mentioned while depositing TDS. If the seller\u2019s PAN is invalid or not provided, the buyer must deduct TDS at 20% instead of 1%, which can be a huge financial burden.<\/p>\n\n\n\n

Step 3: Deduct TDS Before Making Payment<\/strong><\/p>\n\n\n\n

TDS must be deducted at the time of making the payment to the seller, not afterward. This ensures compliance and helps in seamless record-keeping. Always make sure the deduction happens before the full payment is transferred to the seller\u2019s account.<\/p>\n\n\n\n

Step 4: Deposit TDS with the Government<\/strong><\/p>\n\n\n\n

Once the TDS amount is deducted, the buyer must deposit it with the government within 30 days from the end of the month in which the deduction was made. You can do this easily online by filling out Form 26QB on the official TIN NSDL website.<\/p>\n\n\n\n

You\u2019ll need to provide the following details while filling the form:<\/p>\n\n\n\n