One seller is NRI, one is resident. The buyer's TDS splits in two. Here's how.

When a jointly owned property is sold and one owner is an NRI while the other is a resident, the buyer doesn't pick one TDS rule. They run two, one per seller:

Most buyers, and plenty of their lawyers, have never seen a mixed sale. They apply one rule to the whole price, and someone ends up with the wrong TDS. Sorting the split before the sale deed is signed is far cheaper than unwinding it after.

Before you split the TDS, split the ownership. And that's about money, not just names.

Indian tax follows beneficial ownership. If the flat is in two names but one person paid the entire price, tribunals have taxed the whole gain in the payer's hands and treated the other name as convenience; ITAT benches have ruled this way in spouse cases repeatedly. So a deed that says husband and wife doesn't automatically mean 50:50.

Work out each owner's real share from the purchase funding: who paid what, from which account, and whether any share came by gift or inheritance. Then apply Section 195 to the NRI's real share and Section 194-IA to the resident's real share. Where the deed and the funding tell different stories, settle and document the position before the sale, because the buyer's TDS filings will hard-code whatever split you give them.

For the same sale, the buyer does two separate compliances:

Two challans, two forms, two certificates. Ideally the payments are also split, each owner paid their share into their own account, so the money trail matches the deductions.

The NRI co-owner doesn't have to accept 13% to 15% withheld on their full share. A lower-TDS certificate (Form 128, formerly Form 13) applied for before the sale brings the deduction down to the tax on the actual gain. It's per-seller: the certificate covers only the NRI's share, and the resident's 1% track runs unchanged.

On a mixed sale, a CA typically does the whole map: fixes each owner's real share from the funding trail, computes the NRI's gain and files the Form 128 application, gives the buyer the exact section, rate and share instructions in writing, and checks the challans and TDS filings after registration so both owners' credits actually land in their annual tax statement (Form 168, formerly 26AS). When each owner's return then matches their deduction, the usual mismatch trigger for a notice is gone.

Q: The buyer wants to deduct 1% on the whole price. Is that right?

A: No. The 1% (Section 194-IA) covers only the resident co-owner's share. The NRI's share falls under Section 195: deduction on that full share at 12.5% plus surcharge and cess, roughly 13% to 15% all-in, with no minimum threshold.

Q: My co-owner is resident and their share is under ₹50 lakh. Is their share TDS-free?

A: Usually not anymore. Since 1 October 2024 the ₹50 lakh test uses the property's total consideration, aggregated across all buyers and sellers, not each person's slice. If the property's price, or its stamp duty value if higher, is ₹50 lakh or more, the 1% applies to the resident's share.

Q: The deed has my spouse's name but I paid for everything. Is the split 50:50?

A: Not necessarily. Tax follows beneficial ownership, who actually funded the purchase. Tribunals have taxed the whole gain in the paying spouse's hands where the other name was for convenience. Fix the real shares from the funding trail before the sale.

Q: Can the NRI co-owner reduce the 13% to 15% deduction?

A: Yes. A lower-TDS certificate (Form 128, formerly Form 13) applied for before the sale brings the deduction on the NRI's share down to the tax on the actual gain. The resident's 1% track runs unchanged.

Q: Does the buyer need a TAN?

A: For the NRI's share, yes, for now. That half is deposited against the buyer's TAN and filed on Form 144 (formerly 27Q). The resident's share runs on the PAN-based Form 141 (formerly 26QB) route.

Q: The buyer already deducted it wrong. What now?

A: If they put 1% on the NRI's share, switch that share to Section 195 with a TAN and Form 144 (formerly 27Q), and the NRI pays any balance through the return. If they put Section 195 on the resident's share, the resident reclaims the excess through their return. Then correct the filings so each credit lands against the right PAN.