TDS on Commission, Brokerage and Transfer of Immovable Property
From 1 April 2026, the Income-tax Act, 2025 consolidates non-salary TDS provisions in Section 393. This includes commission or brokerage and payments for transfer of specified immovable property. Legacy Sections 194H and 194-IA of the Income-tax Act, 1961 remain relevant for transactions governed by the earlier Act.
Commission or brokerage under Section 393
Commission or brokerage generally covers a payment received or receivable, directly or indirectly, by a person acting on behalf of another person for services other than professional services, for services in the course of buying or selling goods, or in relation to a transaction concerning an asset, valuable article or thing other than securities.
For post-1 April 2026 transactions, deductors should quote the relevant table item of Section 393 instead of old Section 194H. The current Act presents the payer, payee, nature of payment, monetary threshold and applicable TDS rate in the relevant Section 393 table.
Credit or payment rule
Where the provision applies on the earlier of credit or payment, tax is deducted when the income is credited to the payee or actually paid, whichever occurs first. A statutory deeming rule can also treat credit to a suspense account or another account as credit to the payee.
Individual and HUF payments
Section 393 also contains a separate table item for specified payments by an individual or Hindu undivided family to a resident contractor, commission or brokerage recipient, or professional where the special statutory conditions are met. The Income Tax Department's Form 141 includes a dedicated schedule for such payments.
Transfer of immovable property under Section 393(1)
For a buyer paying a resident seller for transfer of specified immovable property other than agricultural land, the current provision is Section 393(1), Table Serial No. 3(i). The Income Tax Department identifies this category in Schedule B of Form 141, which replaces the earlier Form 26QB reporting process for transactions under the 1961 Act.
Rs. 50 lakh threshold
The current e-Filing guidance states that TDS on transfer of immovable property is required where the property value exceeds Rs. 50 lakh. The buyer should examine the total consideration and stamp duty value as required by the current statutory provision and reporting form.
Consideration for transfer
Under the legacy provision, consideration included charges incidental to transfer, such as club membership fee, car-parking fee, electricity or water facility fee, maintenance fee, advance fee and other similar charges. The current Section 393 framework should be applied with the definitions and computational rules in force for the relevant tax year.
Form 141 for property TDS
From Tax Year 2026-27, Form 141 is the unified challan-cum-statement for specified PAN-based TDS transactions under Section 393(1). Schedule B is used for transfer of immovable property. The official form requires details including the property, agreement, stamp duty value, total consideration, buyers, sellers, payment mode and transaction-wise TDS.
Transition table
| Transaction | Up to 31 March 2026 | From 1 April 2026 |
|---|---|---|
| Commission or brokerage to resident | Section 194H, Income-tax Act, 1961 | Relevant Section 393 table item |
| Purchase of specified immovable property from resident seller | Section 194-IA | Section 393(1), Table Serial No. 3(i) |
| Property TDS challan-cum-statement | Form 26QB | Form 141, Schedule B |
Legacy Section 194H: commission or brokerage
The provision required specified persons paying commission or brokerage to a resident to deduct tax at the earlier of credit or payment. Insurance commission governed by Section 194D was excluded.
The uploaded historical text records a 5 percent rate and Rs. 15,000 threshold. Those figures are period-specific and should not be treated as current without checking later amendments. The legacy provision also brought specified individuals and HUFs within TDS where their preceding-year business or professional turnover crossed the prescribed limits.
It excluded commission or brokerage payable by Bharat Sanchar Nigam Limited or Mahanagar Telephone Nigam Limited to their public call office franchisees.
Legacy definition of commission or brokerage
Section 194H included payments received or receivable, directly or indirectly, by a person acting on behalf of another for non-professional services, services in the course of buying or selling goods, or transactions relating to an asset, valuable article or thing other than securities.
Professional services included legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration and other notified professions. Securities took their meaning from the Securities Contracts (Regulation) Act, 1956.
Legacy Section 194-IA: immovable property
The uploaded text records a 1 percent TDS rate and a Rs. 50 lakh consideration threshold. It also provided that the TAN requirement under Section 203A did not apply to a person deducting tax under this section.
For the legacy provision, immovable property meant land other than the specified agricultural land, or any building or part of a building. Agricultural land was defined by reference to the capital-asset provisions of the 1961 Act.
Practical compliance checklist
Identify the payment: determine whether it is ordinary commission or brokerage, a special individual/HUF payment, or consideration for immovable property.
Determine the governing Act: use the applicable payment or credit event around 1 April 2026.
Use Section 393 for current transactions: do not quote old Section 194H or 194-IA for post-1 April 2026 transactions where the 2025 Act applies.
For property purchases: verify the seller's residential status, property type, consideration, stamp duty value, threshold and buyer/seller shares.
File the prescribed statement: use Form 141 Schedule B for current property TDS transactions covered by Section 393(1), Table Serial No. 3(i).
Related Income Tax provisions
Insurance commission and life-insurance policy payments: Sections 194D and 194DA
Repurchase of units and lottery-ticket commission: Sections 194F and 194G
Payments to contractors: Section 194C
Rates, thresholds and procedural requirements should be checked under the law and Finance Act applicable to the actual tax year and transaction.