From 1 October 2026, resident Indian buyers purchasing immovable property from non-resident Indian (NRI) sellers will not have to obtain Tax Deduction and Collection Account Number (TAN) at the time of executing the transaction.

“Earlier (until 30 September), when a resident individual or Hindu Undivided Family (HUF) bought an immovable property from a non-resident, the buyer had to obtain a TAN solely to deduct TDS (tax deducted at source) on the sale proceeds. This is a practical challenge, as some have to go through this process just for one transaction. Also, the process usually takes seven to ten days after filing the application online,” says chartered accountant Mayank Mohanka, Founder, TaxAaram.com. Moreover, it also triggered other compliance questions such as, whether nil TDS returns need to be filed or not. Now, such buyers will have to simply quote the Permanent Account Number (PAN) in Form 141-cum-challan.

“Earlier, they also had to file a quarterly TDS return and issue a TDS certificate. This is a heavy burden for a one-time buyer,” says Naveen Wadhwa, Vice President, Research and Advisory division, Taxmann India. Now, their compliance requirements are at par with those of domestic buyers. “Under the Income Tax (Fifth Amendment) Rules, 2026, effective 1 October, this transaction now falls under Form 141’s new Schedule E, which works on the same PAN-based, single-transaction compliance framework, which is also used for domestic property deals,” adds Mohanka.

The Finance Act, 2026 amended Section 397(1)(c) of the Income Tax Act, 2025, to exempt a resident individual or HUF deducting tax on the transfer of immovable property from obtaining a TAN.

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The buyer will now have to deposit the tax and report the transaction in the new Schedule E of Form 141 and will issue the TDS certificate in Form 132. In case more than one buyer is involved in the transaction, then each will have to file a separate form. Buyers should also bear in mind certain additional requirements that will kick in from 1 October: they will mandatorily have to mention the seller’s contact number, email ID and overseas address.

“In cases where the non-resident seller does not have a PAN, the buyer must furnish the seller’s Tax Residency Certificate (TRC) number and Tax Identification Number (TIN). Without these, tax will be deducted at a higher rate. This removes the biggest compliance hurdle for individuals buying property from NRIs,” adds Wadhwa. A TRC is a certificate of being resident in any country (or specified territories outside India) from the government of that country.