Stage · Active situation
Last updated 16 October 2026 · By Vipul Sharma, Founder · Reviewed by Preetesh Maloo, CA
Form 128 under Section 395 is the lower-TDS application from 1 April 2026. For a sale in FY 2025-26 the form is still Form 13 under Section 197. The Income Tax Department form guide names Form 128. The Assessing Officer decides the rate. Withholding can arise on payment or credit, whichever is earlier, including an advance. A CA can prepare the application. Approval and refund timing are not guaranteed. The long guide is Form 128, formerly Form 13.
Form 13 + Section 54/54F + ITR. One CA, end-to-end. We brief your buyer's lawyer.
Post 23 July 2024 · what changed for NRI sellers
Finance (No. 2) Act 2024 rewrote Section 112 to a flat 12.5% LTCG with no indexation on land and building. The election back to 20% with indexation is reserved for residents. NRIs don't get it. Grandfathering still works for pre-2001 assets and inherited property under Section 49(1).
Inherited? Run the grandfathering calculator first →
Quick answers
Section 195 requires the buyer to deduct 12.5% TDS on the full sale value for land and building sold on or after 23 July 2024, not on the capital gain, with surcharge and cess on top. Ask a CA to review the applicable withholding route and any lower-deduction application before payment.
Before the first payment or credit that needs lower withholding, including an advance. Prepare the draft agreement, cost records and any proposed exemption evidence for the CA's review. The Assessing Officer may ask for more information; there is no guaranteed processing period.
No. Section 194-IA applies only when the seller is a resident; the buyer's residential status is irrelevant. NRI sellers fall under Section 195, which imposes 12.5% on the full sale value. A buyer who wrongly uses Section 194-IA with an NRI seller creates a compliance problem that surfaces months later.
Sale value, purchase year, and how you came to own it.
Enter in lakhs. ₹2 Cr = 200, ₹50L = 50.
Decade first, then the year. Affects grandfathering and indexation.
Computed in your browser. Numbers stay on your device.
Real recovery numbers. Remote filings from 52 countries.
Want a CA to file Form 128 (formerly Form 13) before the buyer pays?
3-5 weeks lead time. We file with the assessing officer and your buyer's lawyer.
Senior CA who specialises in NRI tax · we deal with the tax officer, you don't
Other situations we handle
One NRI tax problem usually opens a door to the next. Here's the most likely next step from where you are right now.
Section 195 bites on the sum chargeable to tax, but in practice the buyer withholds 12.5% of the full sale value for land or building sold on or after 23 July 2024, because they cannot see your cost base. Surcharge and cess sit on top. To cut it before the sale, apply for a Form 128 certificate under Section 395 (this was Form 13 under Section 197 before April 2026). The buyer can also apply under Section 195(2).
Ideally 6 to 10 weeks before the sale-deed registration date. The application (Form 13, now Form 128) has been filed TAN-wise, needing the buyer's TAN, not their PAN, plus the draft sale agreement, your cost basis documents, and a reinvestment plan if you are claiming Section 54 or 54EC relief. Most individual buyers have no TAN and have had to apply for one first, so build that into the timeline. From 1 October 2026 a resident individual or HUF buyer no longer needs a TAN to deduct, so if your buyer has only a PAN, confirm how the application identifies them before filing.
Yes, but you give up roughly ₹30 lakh of liquid cash on a ₹2 Cr sale for 9 to 12 months until the ITR refund lands. 12.5% plus surcharge and cess is about 14.95%, not 12.5%. A certificate granted in time can cut the withholding to a few percent of the sale value, freeing most of the proceeds on day one.
No. Section 194-IA applies only when the SELLER is a resident (the buyer's residential status is irrelevant). NRI sellers fall under Section 195, which imposes 12.5% on the full sale value. Buyers who wrongly use Section 194-IA with an NRI seller create a compliance problem that surfaces months later.
Yes. The AO will certify a lower TDS rate that reflects your actual tax liability after projected Section 54 (new residential house), Section 54F, or Section 54EC (bonds) reinvestment. The certificate is conditional on you actually completing the reinvestment within the statutory window.
Cookies for analytics + ads
We use Google Analytics 4, Google Ads conversion tracking, Meta Pixel, LinkedIn Insight Tag, and Microsoft Clarity to understand traffic and improve the site. Essential cookies (country detection, session) always run. Read more.