Comprehensive Guide to Selling NRI Property in India from Abroad (2024)

Introduction

Selling property in India as a non-resident Indian (NRI) or a foreign national requires navigating a complex process. Whether you're an NRI looking to sell your residential or commercial property or a foreign citizen inheriting Indian assets, understanding the intricacies is crucial for a smooth transaction.

Initial Steps

1. Property Valuation: Conduct a thorough property valuation to determine its worth. Hiring a professional ensures accuracy in assessing the property's value.

2. Power of Attorney: Execute a valid power of attorney, authorizing a trustworthy individual to represent you in the sale process, especially if you can't personally visit India.

3. Bank Accounts: Open an NRE/NRO bank account to receive the proceeds of the sale, streamlining the financial aspect of the transaction.

Documentation Requirements

Ensure you have the necessary documents to facilitate the sale:

1. Power of Attorney: Draft a power of attorney for property sale.

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2. Identity Proof: Provide a passport as a valid identity proof.

3. PAN Card: For NRIs with PAN numbers, include it with the foreign residence address.

4. Tax Returns: Furnish tax returns if you've earned income from the property.

5. Address Proof: Submit documents supporting your address in India and abroad.

6. Sale Deed: A legally binding agreement between buyer and seller.

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7. Society Documents: Present documents from the society to confirm no outstanding payments.

8. Occupation Certificate: Prove property occupation and include the allotment letter for official authority.

9. Encumbrance Certificate: Verify the property's freedom from legal or financial burdens.

Tax Considerations

Understanding tax implications is crucial to avoid fines and penalties:

1. TDS (Tax Deducted at Source): The buyer must deduct TDS at the time of payment, with rates specified in the sale deed.

2. Capital Gains Tax: Differentiate between short-term and long-term capital gains, with taxes applicable based on the transfer date and agreement value.

3. Double Taxes: Be aware of double taxation if your country of residence taxes global income.

4. Tax Exemptions: Explore exemptions based on your situation, such as reinvesting in property to potentially save on long-term capital gains tax.

Repatriation of Funds

Follow FEMA rules for repatriation, considering limits on the number of residential properties and the repatriated amount. Seek permission from the RBI if repatriating more than the specified limit.

How We Can Help

Our professional team provides legal advice and assistance for property sales in India. Contact us at 02087575751 or use our free assessment form for personalized support.

In conclusion, selling NRI property in India involves meticulous planning, adherence to documentation requirements, and a clear understanding of tax implications. Our team is here to guide you through this intricate process, ensuring a seamless and legally sound transaction.