TDS on Joint Property Purchase: How Co-Buyers Should File Form 26QB in AY 2026-27
TL;DR
- Each co-buyer must file a separate Form 26QB for their share of consideration, even if the property is bought jointly.
- The Rs. 50 lakh threshold applies to the total sale consideration, not to each co-buyer's share.
- Joint sellers also require separate Form 26QB filings; the matrix can grow quickly.
- Each co-buyer pays TDS proportionate to their share defined in the sale deed or the agreed financial arrangement.
- Failure to file separate forms is a common source of CPC-TDS default notices.
What this means in plain terms
Most Indian families buy property jointly. Husband-wife co-ownership, parent-child co-purchase, sibling co-buyer arrangements are normal. The income tax department treats each co-buyer as a separate taxpayer with separate TDS obligations under Section 194-IA. The rule is simple in concept but messy in execution: each unique buyer-seller pairing needs its own Form 26QB.
A husband-wife pair buying from a husband-wife seller means four Form 26QB filings, not one. Most first-time joint buyers file a single combined Form 26QB and run into trouble later when one co-buyer's name does not appear in the seller's Form 26AS. Getting the split right at the filing stage prevents months of correction back-and-forth on the TRACES portal.
Why the Rs. 50 lakh threshold applies to total deal value
Aggregate consideration is the test
The CBDT has repeatedly clarified that the Rs. 50 lakh threshold under Section 194-IA is checked against the total sale consideration, not each co-buyer's individual share. So if two co-buyers buy a Rs. 60 lakh property at 50:50, both buyers must comply even though each pays only Rs. 30 lakh.
Why splitting will not work
Some buyers think they can avoid TDS by structuring the sale to make each share below Rs. 50 lakh. This is a common but flawed reading. The provision uses the phrase "consideration for transfer", which is the deal value as a whole.
What if the property is below Rs. 50 lakh
If the total deal value is below Rs. 50 lakh, no Form 26QB is needed regardless of the number of co-buyers. Section 194-IA simply does not apply.
The buyer-seller matrix
One buyer, one seller
Standard case. One Form 26QB is filed by the buyer for the full sale consideration.
Two buyers, one seller
Each buyer files a separate Form 26QB for their share. So two filings, two challans, two acknowledgements.
One buyer, two sellers
One buyer files two Form 26QB, one for each seller's share. So two filings.
Two buyers, two sellers
Four Form 26QB filings (2 x 2 = 4). Each buyer files one form per seller, capturing their respective shares.
How to split the consideration
Equal share by default
If the sale deed is silent on percentage shares, the law presumes equal ownership. So two co-buyers contribute 50:50, three co-buyers 33.33% each.
Explicit shares in the deed
If the sale deed specifies different percentages (say 60:40), the TDS is split in those proportions. This is critical for tax planning, especially when one co-buyer is in a higher slab.
Funding source vs ownership
The TDS split follows the ownership share in the sale deed, not the source of funds. So if one spouse funded 80% but the sale deed records 50:50, TDS is split 50:50 too.
A real example
Vikram and Kavya, both 36, a working couple in Chennai with combined CTC of Rs. 42L, jointly buy a 4BHK apartment in Pallavaram for Rs. 1.2 crore from co-sellers Aditya and Anjali (a brother-sister pair, 50:50 ownership). The sale deed records the buyers at 60:40 (Vikram:Kavya).
Here is the TDS matrix:
- Each seller's share = Rs. 60 lakh each.
- Vikram's payment to Aditya = Rs. 60 lakh x 60% = Rs. 36 lakh. TDS = 1% of Rs. 36 lakh = Rs. 36,000.
- Vikram's payment to Anjali = Rs. 60 lakh x 60% = Rs. 36 lakh. TDS = Rs. 36,000.
- Kavya's payment to Aditya = Rs. 60 lakh x 40% = Rs. 24 lakh. TDS = Rs. 24,000.
- Kavya's payment to Anjali = Rs. 60 lakh x 40% = Rs. 24 lakh. TDS = Rs. 24,000.
Vikram files two Form 26QB filings (one for each seller). Kavya files two Form 26QB filings (one for each seller). Total: four Form 26QB filings, four challans of Rs. 36,000, Rs. 36,000, Rs. 24,000, Rs. 24,000. Total TDS = Rs. 1,20,000 (1% of Rs. 1.2 crore).
Each seller sees their respective TDS credits in AIS: Aditya gets Rs. 60,000 credit (Rs. 36,000 + Rs. 24,000) and Anjali gets Rs. 60,000 credit. Clean reconciliation.
What to do this week
- Confirm the ownership shares of each co-buyer and co-seller in the sale deed before filing Form 26QB.
- Use a buyer-seller matrix to count the exact number of Form 26QB filings required.
- Cross-verify each PAN multiple times before filing; mismatches are the most common cause of notices.
- After all Form 26QBs are processed, download each Form 16B from TRACES and hand to respective sellers.
- Run the 6-step assessment at https://myfinancial.in to see your old-vs-new regime delta, unused deductions, and insurance gap in under 10 minutes.
FAQ
Can co-buyers file a single combined Form 26QB?
No. The CBDT requires separate Form 26QB for each buyer. A single combined filing creates only one buyer name in the system, and the other co-buyer's record gets missed.
What if the bank loan is in only one co-buyer's name?
The TDS split follows ownership in the sale deed, not the loan structure. So the loan-paying buyer cannot file the entire TDS in their name if both are co-owners.
How is the share decided when not specified in the deed?
By default, the law presumes equal share. Two co-buyers default to 50:50. Three default to 33.33% each. Use written declarations if you want different splits.
What if one co-buyer is an NRI?
Then Section 195 applies to the NRI co-buyer's share (if applicable to a particular transaction structure). However, for property purchase, the NRI as buyer pays in India and Section 194-IA applies if seller is resident. The NRI co-buyer's PAN-based filing is the same as for residents in this scenario.
Can the higher-earning spouse claim full Section 80C and home loan deduction?
No. Each co-owner can claim deductions proportional to their share. Section 24(b) interest deduction and Section 80C principal repayment are split per ownership ratio.
What if I forgot to file separate Form 26QB and filed only one combined?
Login to TRACES, file a correction under "Request for Correction", and submit additional Form 26QBs for the missed co-buyer. Interest and late fees may apply if outside the 30-day window.
Are joint sellers responsible for ensuring buyer files correctly?
The seller cannot file Form 26QB; only the buyer can. But the seller's interest is to ensure correct PAN and share split because incorrect filings show up as missing TDS credit in their AIS.
Sources
- https://incometax.gov.in
- https://contents.tdscpc.gov.in
- https://www.tin-nsdl.com
- https://finmin.nic.in
This is general information, not personalised advice. For your situation, consult a Certified Financial Planner.
