Buying a Bengaluru Flat from an NRI? From 1 October 2026 You Use PAN, Not TAN

1. What the Bengaluru flyer got right

The graphic doing the rounds is not a rumour. From 1 October 2026, a resident individual or Hindu undivided family buying immovable property from a non-resident no longer has to take a Tax Deduction and Collection Account Number just to pay TDS. The buyer quotes PAN. CBDT notified the machinery on 22 September 2026 — Income-tax (Fifth Amendment) Rules, 2026, Notification 121/2026, G.S.R. 830(E) — effective 1 October. Finance Act 2026 had already rewritten section 397 of the Income-tax Act, 2025 to carve that transaction out of the TAN list.

Until 30 September 2026 the old path still applies: apply for TAN, deduct, challan, quarterly non-resident TDS statement. Do not try the new form a day early.

2. Why this mattered in Bengaluru

A large share of resale inventory here has an NRI on the seller side — a Whitefield apartment bought in 2012, a JP Nagar site held by a sibling in Dubai. The resident buyer was treated like a company making a foreign remittance: wait 7–10 days for a TAN for a deal that may happen once in a life. Resident-to-resident sales already used PAN and a one-page challan. From 1 October the NRI purchase, for individuals and HUFs, joins that simpler filing family. Companies, LLPs and firms buying from an NRI are not in the carve-out.

3. The new paperwork, in order

Deduct TDS when you pay or credit the NRI. Deposit it with a challan-cum-statement in Form No. 141, new Schedule E — property particulars, buyer and non-resident seller, stamp-duty value, sale consideration, instalments, capital-gains fields, TDS rate, any section 395 certificate numbers. Due date: 30 days from the end of the month of deduction. Example: deduct on 10 October 2026, pay and file by 30 November 2026. The certificate you give the seller is Form No. 132, due 15 days after the Form 141 due date. Two names on the sale deed means two Form 141s.

Schedule E also wants the NRI’s contact number, email and address in the country of residence — mandatory whether or not they have a PAN. If they have no PAN, add the tax residency certificate and the foreign tax identification number (rule 217), or the law pushes you to a higher deduction rate.

4. What did not get easier

TDS on an NRI is still not the 1% resident-seller rule. There is no ₹50 lakh skip. The entry is section 393(2) table Sl. No. 17 — any other sum chargeable to a non-resident — at the rates in force. In practice buyers often withhold on the full price unless the seller (or the buyer) has a lower/nil certificate under section 395. If the NRI’s real gain is small, that certificate should be in the file before you write the demand draft. Run the numbers on the PE Realtors capital gains calculator so you are not guessing the base.

FEMA, Form 15CA/15CB on the remittance, and the NRI’s ITR credit still sit outside Form 141. The PAN shortcut is only the buyer’s TAN. It does not turn an NRI sale into a resident sale.

5. A one-page checklist for a Bengaluru closing after 1 October

• Confirm the seller is non-resident for tax, not just ‘lives in Dubai’.
• If you are an individual or HUF, skip TAN; keep PAN handy for Form 141 Schedule E.
• Collect NRI PAN or TRC + TIN, plus overseas phone, email and address.
• Ask for a section 395 certificate if TDS on the full price would be brutal.
• Deduct, file Form 141 within 30 days of month-end, issue Form 132. Co-buyers file separately.

6. If the file is messy, ticket it

Joint NRI sellers, a missing PAN, or a closing that straddles 30 September / 1 October is where people file the wrong form. Open a PE Realtors legal services ticket with the sale deed, PAN copies and the seller’s residency papers. Assessment is ₹250 including GST. Actual service charges are told to you before work starts.