CBDT has introduced changes in the TDS reporting requirements for property transactions involving non-residents through Notification No. 121/2026 dated 24 September 2026. The notification extends the reporting framework for such transactions and makes consequential changes to Forms 132 and 141 under the Income-tax Rules, 2026.

How Does It Matter to Property Buyers?

Buying a property from a non-resident seller requires greater care from a TDS perspective than a normal resident property transaction. The buyer needs to correctly identify the residential status of the seller, determine the applicable TDS provisions and comply with the prescribed payment and reporting requirements.

With the latest amendment, taxpayers dealing with non-resident property transactions should also review the revised reporting requirements and updated forms rather than relying on the procedure they may have followed for earlier transactions.

What Should Buyers Check Before Making Payment?

Before making payment to a non-resident property seller, buyers should verify the seller’s residential status, applicable TDS provision and rate, availability of any lower/nil deduction certificate, and the correct reporting mechanism.

This is particularly important because TDS on a property purchase from an NRI should not automatically be treated in the same manner as TDS on purchase from a resident seller. Proper tax determination before making the payment can avoid reporting and withholding issues later.

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