CBDT amends TDS rules for buying property from a non-resident, effective 1 October
A CBDT notification dated 22 September 2026 adds a new reporting item to income-tax Forms 132 and 141, and a new Schedule E to Form 141, covering tax deducted at source when a resident individual or Hindu Undivided Family pays a non-resident for immovable property. It takes effect on 1 October 2026.
The Central Board of Direct Taxes (CBDT) has amended the Income-tax Rules, 2026 to add a new reporting requirement for tax deducted at source (TDS) when a resident individual or Hindu Undivided Family (HUF) buys immovable property from a non-resident seller. The Income-tax (Fifth Amendment) Rules, 2026, notified on 22 September 2026, take effect on 1 October 2026.
What the notification changes
- A new item in the reporting table. Rule 215(1) already listed deductions under section 393(1) of the Income-tax Act, 2025 (which, per Forms 132 and 141, includes cases such as transfer of a virtual digital asset) under one reporting item. The amendment adds deductions under section 393(2) — where a resident individual or HUF must deduct tax on consideration paid for transfer of immovable property — to the same item.
- Form 132 and Form 141 updated. Both forms gain a new entry, “Transfer of immovable property by a non-resident to a resident individual or Hindu undivided family,” alongside the existing virtual-digital-asset entry.
- A new Schedule E in Form 141. It asks for the property’s address and type (land, building, or both); the PAN, name and share of every buyer; and for every non-resident seller: name, status (individual, company, firm, HUF, etc.), contact number, email, overseas address, tax residency certificate number, tax identification number, and share of the sale consideration. It also asks for the agreement and registration dates, stamp duty value, total consideration, whether payment is lumpsum or in instalments, the type of capital gains involved, the TDS rate applied, and the amount deducted.
Key facts
| Item | Detail |
|---|---|
| Notification | No. 121/2026, G.S.R. 830(E) |
| Dated | 22 September 2026 |
| Short title | Income-tax (Fifth Amendment) Rules, 2026 |
| Effective from | 1 October 2026 |
| Rules amended | Rules 215, 218 and 219, and Forms 132 and 141 (Appendix III) of the Income-tax Rules, 2026 |
| Made under | Sections 533, 395(4)(a) and 397(3)(a)-(b), Income-tax Act, 2025 (the new reporting item covers deductions under section 393(2)) |
| Who it applies to | A resident individual or HUF paying a non-resident for transfer of immovable property |
Background
Section 393(2) of the Income-tax Act, 2025 already required a resident individual or HUF to deduct tax at source on money paid or credited to a non-resident for immovable property. Until this amendment, the rules governing how that deduction is reported did not route it through the same table item as the other section 393(1) deductions in rule 215(1). From 1 October 2026, it does — with a corresponding new Schedule E added to Form 141 to capture the buyer, seller, property and tax-deduction details the return needs.
Basis of these figures
The notification number, date, effective date, the powers under which it was made, the rules and forms amended, and the fields listed in Schedule E are all taken directly from the CBDT’s own gazette notification, No. 121/2026, G.S.R. 830(E).