New Schedule E in Form 141 Simplifies TDS Reporting for Property Deals with Non-Residents

Starting October 1, 2026, a new process will change how resident individuals and Hindu Undivided Families (HUFs) report taxes when buying property from non-residents. The Central Board of Direct Taxes (CBDT) has updated Form 141 to include a new section, Schedule E. This change allows buyers to use their Permanent Account Number (PAN) instead of needing a Tax Deduction and Collection Account Number (TAN) for these specific property transactions. This aims to make the reporting process simpler for many buyers.

Understanding the Revised TDS Reporting Process

The update means that resident buyers who purchase immovable property from non-resident sellers now have a streamlined way to handle Tax Deducted at Source (TDS). Previously, these transactions often required a TAN, which added an extra step for individuals and HUFs. The new Schedule E within Form 141 is designed to capture all necessary details for these property deals directly. This revised route applies specifically when a resident individual or HUF is the buyer and a non-resident is the seller.

Key Steps for Buyers in Property Transactions

Buyers involved in these property deals must now follow a specific procedure for TDS reporting. This involves deducting the applicable tax at source, depositing it with the government, and then providing a certificate to the seller. The deposit of the deducted tax must be made within 30 days from the end of the month in which the tax was deducted. This entire process, including payment and reporting, is now combined into a single challan-cum-statement. Any applicable surcharge and cess must also be included in the reported tax amount.

Form 132: The TDS Certificate for Sellers

After completing the filing and deposit, the buyer is responsible for issuing a TDS certificate to the non-resident seller. This certificate is provided in Form 132, which has also been updated to align with the new reporting framework. This ensures that the seller has the necessary documentation for their own tax purposes, confirming that the TDS has been deducted and reported correctly by the buyer.

The Amendment’s Impact on Tax Rules

The government officially announced these changes through the Income-tax (Fifth Amendment) Rules, 2026, on September 22, 2026. These rules establish the new framework for TDS payments and reporting, which officially begins on October 1, 2026. The heading of Form 141 now reflects deductions under Section 393(1) and Section 393(2) of the Income Tax Act. The newly added Schedule E is specifically for reporting property transfers from non-residents to resident individuals or HUFs. Additionally, Rules 215, 218, and 219 of the Income Tax Rules have been amended to integrate these transactions into the established TDS payment and reporting system.

Details Captured in Schedule E

Schedule E requires comprehensive information about the property, the parties involved, and the payment details. This includes the property’s address and type, the agreement and registration dates, and the stamp duty value. For the buyers, their names and PANs are needed, along with their share of the consideration and the total sale value.

The seller’s information goes beyond just their PAN. Buyers must provide the seller’s residential status, overseas address, contact number, and email ID. Even if the seller has a PAN, details like their Tax Residency Certificate number and Tax Identification Number (if applicable) must be included, along with their country of residence address.

Payment details are also crucial. Buyers need to specify if the payment is a lump sum or in installments, the amount paid in the current transaction, and the date of payment. The schedule also requires reporting the total consideration and the specific amount on which TDS is payable. Finally, the applicable TDS rate, the amount deducted, and the date of deduction are recorded, including any applicable surcharge and cess.

Simplifying Transactions for One-Time Property Deals

This new reporting route is particularly beneficial for individual and HUF buyers who are making one-time property purchases from non-residents. By allowing the use of PAN instead of a TAN, the CBDT has aimed to reduce compliance burdens. Tax experts view this amendment as a practical relief measure, simplifying the process for those involved in these specific types of property transactions. The revised process will be in effect for all covered purchases made from October 1, 2026, onwards.

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