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🏠 Buying Property from an NRI? Here’s What You MUST Know! 💰

 

🏠💰 Buying Property from an NRI? Here’s What You MUST Know!

❓ Q1: What is the current TDS rate for property purchased from an NRI?

✅ A: As of July 23rd, 2024, TDS for Long-Term Capital Gains is deducted at 12.5% base rate ➕ 15% surcharge ➕ 4% cess, making it 🔹14.95% effective TDS.

❓ Q2: Where should the buyer deposit the sale amount?

🏦 A: The sale proceeds must be deposited into the NRI seller’s NRO (Non-Resident Ordinary) account as per FEMA guidelines.

❓ Q3: Can the sale amount be paid to a PoA (Power of Attorney) holder?

⚠️ A: Only if absolutely necessary. The PoA should:
✍️ Be clearly authorized to receive funds
📄 Have this mentioned in the sale deed
💼 Deposit funds immediately into the NRI's NRO account

❓ Q4: What are the risks of paying a PoA holder instead of the NRI’s account?

🚨 A: It can lead to non-compliance under FEMA, draw tax scrutiny, and invite legal issues if funds are misused or delayed.

❓ Q5: What forms are needed to remit money into an NRI’s NRO account?
🧾 A:

  • 📌 Form 15CA (to be filed by the buyer)
  • 📌 Form 15CB (issued by a Chartered Accountant)
    These ensure tax is properly deducted before remittance.

❓ Q6: Can funds from an NRO account be repatriated abroad?

🌍 A: Yes! ✅ Up to USD 1 million per financial year (after tax) can be repatriated, subject to documentation and compliance.

❓ Q7: What’s the safest way to handle a property sale from an NRI?

🛡️ A:
💯 Pay directly into the NRI’s NRO account
✂️ Deduct the correct TDS (14.95%)
🧾 File Form 15CA & get Form 15CB
🔐 Stay FEMA & Income Tax compliant

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