What happens if NRI sells property in India?

When an NRI sells property, the buyer is liable to deduct TDS @ 20%. In case the property has been sold before 2 years(reduced from the date of purchase) a TDS of 30% shall be applicable.

How can NRI avoid TDS on property sale?

Reduce your TDS Liability by filing application in Form 13

To reduce the TDS on Sale of Property by NRI, the NRI is required to file an application in Form 13 with the Income Tax Department for issuance of Certificate for Nil/ Lower Deduction of TDS.

Can I sell property in India and bring money to USA?

Yes, you can bring the proceedings to the US. It is recommended that you get the payment of the property through proper banking channels. Documenting proof is required for transferring money on sale of property. The first step is to get a certificate from a Chartered Accountant (CA) in India.

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Do I need to pay tax if I sell my property in India?

If you are planning to sell your property, you’ll have to pay capital gain tax on the profit earned after considering the inflation and indexed cost of acquisition. … If you’re selling a property in India, the profits you earn are called Capital Gains.

Can NRI sell property in India without PAN card?

Property is an important resource, and for ages, it has been an exceptionally time-consuming and taxing process to sell property in India from overseas. … In order to enter into a property transaction, it is not necessary for an NRI or a PIO (origin being dated up to the fourth generation of ancestry) to have a PAN card.

Can NRI claim TDS refund on property sale?

If NRIs file Income Tax Returns (ITR) after the financial year has ended in India, they can claim refunds on the deducted TDS. For an NRI to claim a refund on the TDS deducted, he/she must self-compute their income and tax liability according to existing slab rates.

What happens if TDS is not deducted on purchase of property from NRI?

In case the buyer fails to deduct the TDS (wholly or partly) or fails to deposit the TDS with the Government, then the buyer (i.e. Deductor) would be liable to pay penalty under section 271C. Here, the defaulter would be required to pay penalty amounting to sum equal to the TDS not deducted or TDS not paid.

Do NRI pay capital gains tax?

NRIs are subject to TDS at the applicable rates on capital gains earned at the highest tax rates, irrespective of any threshold value. The rate of TDS is 10 per cent on the equity-related capital gains and 20 per cent post indexation for other than equity investments.

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How can I avoid paying tax on selling property in India?

Exemptions from your Gains that Save Tax Section 54F (applicable in case its a long term capital asset)

  1. Purchase one house within 1 year before the date of transfer or 2 years after that.
  2. Construct one house within 3 years after the date of transfer.
  3. You do not sell this house within 3 years of purchase or construction.

How much money can NRI transfer out of India?

How much money can an NRI repatriate out of India? An NRI can freely transfer without any upper transaction limit from NRE and FCNR accounts. On the other hand, an NRI can remit only up to 1 USD million out of the balances of an NRO account, provided they meet the eligibility criteria.

How do you avoid tax on property sale?

However, to avoid tax on short-term capital gains, the only way out is to set it off against any short-term loss from the sale of other assets such as stocks, gold or another property. To plug tax leaks, the government has now made it mandatory for buyers to deduct TDS when they buy a house worth over Rs 50 lakh.

What tax do I pay if I sell a property?

Capital gains tax (CGT) is payable when you sell an asset that has increased in value since you bought it. The rate varies based on a number of factors, such as your income and size of gain. Capital gains tax on residential property may be 18% or 28% of the gain (not the total sale price).

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How long do you have to live in a property to avoid capital gains tax?

To get around the capital gains tax, you need to live in your primary residence at least two of the five years before you sell it. Note that this does not mean you have to own the property for a minimum of 5 years, however. Once you’ve lived in the property for at least 2 years, you’d reach capital gains tax exemption.

How NRI can sell property in India without coming to India?

If you are a Non-Resident Indian, you can sell the property to a Resident Indian without restrictions. If the buyer is a Non-Resident Indian or a Person of Indian Origin (POI), you may need the approval of the Reserve Bank of India (RBI). You are not allowed to sell the property to a foreigner.

Do you need Aadhar card to sell property in India?

Yes. An NRI can sell property in India without an Aadhar Card as it is not mandatory for NRIs to have an Aadhar Card. The buyer must check for an NRO Account in the name of the NRI though where the proceeds from the sale of property will be deposited.

What is required to sell a property in India?

Sale deed is important as it traces the ownership of the property. It is necessary to prove the chain of previous agreements with past owners. Seller also needs to have a copy of the approved building plan and occupation certificate issued by the competent authority.