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Form 13: the lower TDS certificate

A certificate that lets the buyer deduct tax on your real gain instead of 13-15% of the whole sale price.

NRI property seller and tax professional reviewing an approved lower-TDS document and a fair tax allocation

NRIWallah team

Updated October 2026 · 3 min read

What Form 13 does

Under section 195, a buyer paying an NRI must deduct tax at source on the entire sale consideration, because the law does not let the buyer estimate your gain. Section 197 is the way out. You apply on Form 13, the assessing officer works out the tax you will actually owe, and the officer issues a certificate telling the buyer to deduct only that amount. The certificate names the buyer and is valid for the financial year of issue.

The difference can be large. Take a flat bought for ₹80 lakh in 2015 and sold for ₹1.5 crore. Without a certificate, TDS is about ₹21 lakh, which is 12.5% plus surcharge and cess on the full ₹1.5 crore. The long-term gains tax on the ₹70 lakh gain is about ₹10 lakh, and close to nil if you reinvest under section 54. Form 13 leaves the difference with you instead of the tax department until your refund is processed. The property sale TDS guide covers the whole sale, including rates, exemptions and repatriation.

The rate the certificate gives

The officer computes your expected tax as sale price minus cost, using the previous owner’s cost and holding period for inherited property. It applies the 12.5% long-term rate and any section 54 or 54EC reinvestment you commit to. The buyer then deducts that amount. A sale with a modest gain can end up with an effective rate far below 13-15% of the price, and a nil certificate is possible where exemptions cover the whole gain.

The application, step by step

  1. Engage a CA and compute the gain. The application rests on a gain computation you can defend, with the purchase deed, improvement costs and the inherited cost where it applies.
  2. Gather the buyer’s details. The application names the buyer and their TAN. A buyer without one can usually get one within days, and needs it to deposit the TDS anyway.
  3. File Form 13 online with the computation and supporting documents.
  4. Answer the officer’s queries. Officers often ask for proof of payment on the original purchase or for detail on exemption claims. Quick, complete replies keep the process moving.
  5. Share the certificate with the buyer. They deduct at the certified rate, deposit it against their TAN and give you Form 16A.

Common reasons for rejection or delay

  • No purchase-cost evidence. Rebuild it from bank statements, builder receipts or the sub-registrar’s records before you file.
  • Exemption claims without commitment. “I might buy another flat” is not a section 54 claim, and officers want specifics.
  • Mismatched names. Maiden names, spelling differences between PAN and the deed, or a joint owner missing from the application.
  • Filing too late. An application a few days before completion forces a choice between delaying the sale and accepting full TDS.
  • No Indian tax filing history. This is not fatal, but expect more questions. A covering computation from a CA carries weight.

Cost and benefit

A CA’s fee for a Form 13 engagement is small beside the cash it can keep out of withholding, which on a sale of this size can be lakhs. Joint owners each file their own application, because each co-owner is a separate seller for TDS purposes, and most CAs bundle them.

After the sale, the same CA can usually handle the Form 15CB certificate you need to repatriate the proceeds. Check the limits with the repatriation calculator, and your home-country credit with the DTAA estimator. When the money is free to move, the remittance comparison shows which provider gets the most to your account abroad.

This guide is general information, not tax advice. Rules are current for FY 2025-26 and change with each Budget. For your own application, use the form on this page. NRIWallah may receive a referral fee from the professional, never from you (how we make money).

Common questions

Several weeks from a complete application. Complex cases, such as inherited property, joint owners or missing purchase documents, take longer. The certificate is issued for a specific buyer and financial year, so apply as soon as the buyer is identified and not after the sale deed is signed.
Your PAN, passport, visa or OCI proof of NRI status, the original purchase deed and payment proofs, the draft agreement or buyer details including the buyer’s TAN, a capital gains estimate computed by a CA and, if you have filed them, your recent Indian tax returns. Missing purchase-cost evidence is the usual gap, and bank statements from the original purchase often fill it.
Yes. A buyer who wants to complete quickly can deduct full TDS instead, which is legal but ties up your money for a year or more. A middle route is to write the timeline into the agreement to sell: a token advance now, completion when the certificate is issued and a long-stop date. Most buyers cooperate once they understand that their TAN and deposit duties apply either way.

Get a CA to file your Form 13

Matched introductions to chartered accountants who file NRI lower-TDS applications every week, free and with no obligation.

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Free to use. NRIWallah may receive a referral fee from the professional, never from you — how we make money.

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