Travelling to India for Buying or selling of property is most certainly straining for working NRI/OCI professionals and business owners.
Constraints NRI’s usually face are
Always under Time Pressure
Possible unproductive trips to India
knowledge of Compliances & Tax management
Tax Advisory & Compliance
Providing tax advisory to clients seeking clarity on tax on sale of property, computation of Long-term or Short-term capital gain tax, or to know all tax related compliance etc. Some of the key questions (not an exhaustive list) that we can help you with are.
- What is various tax compliance on buying or selling of property?
- What are various taxes and rate therein?
- What is TDS rate on sale of property for NRI?
- What are the various ways to save tax on sale of property for NRI?
- Different timeline for tax related compliance?
- CA Services for Filing 15CA 15CB Services in India – For NRIs, PIOs, OCIs.
- Computation of TDS or Eligible Tax Deduction and filing of all requisite returns
- Remittance of Property Sale Receipts outside India by PIOs, NRIs
- Any related query
- NRI Repatriation Services
- NRI Deductions, Exemptions, Reliefs in Income Tax Act
- NRI Seafarer Taxation in India
- TCS on Liberalised Remittance Scheme, Foreign Remittances
Benefits You Get with Us
Unbiased advice and Comprehensive support
Our expert team consists of CA’s and lawyers equipped to devise the most comprehensive and optimised solution.
One Stop Shop
Our experts can help in all matters of property buying & liquidation and other forms of investments. Our scope can include all or any covering – Tax advisory and Compliance, Legal Documents Drafting.
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Frequently Asked Questions
Can you help us with end-to-end solution covering Listing, Legal & Financial aspect of the transaction?
The tax is to be paid on complete transaction amount on sale of property?
- Long-term Capital Gain: Property held for more than 2 years
- Short-term Capital Gain: Property held for less than 2 years
Who deducts the TDS and how? Can you explain the process step by step?
- The TDS on sale of property by NRI is required to be deducted under Section 195
- The seller shall file an application in Form 13 with the Income Tax Dept and request them to compute his Capital Gains. In case this certificate is not obtained by the seller from the Income Tax Department, the TDS should be deducted on the Total Sale Price and not on the Capital Gains. Therefore, it is very important for the seller to obtain this certificate from the Income Tax Officer.
- The Income Tax Department will compute the Capital Gains of the seller and will issue a certificate for Nil/ Lower deduction of TDS depending on the capital gains arising on the sale of property. (Please note, this calculation of Capital Gains cannot be done by the Seller himself and must be done by the Income Tax Officer.)
- The seller is required to give this certificate to the buyer and the buyer will deduct the TDS as per the rates mentioned in the income tax certificate.
- Also, what is important to know is that the buyer must have a TAN no to be able to buy a property from an NRI. Do note that PAN number is different than TAN number.
- If the buyer is buying a property jointly with someone; both must have separate TAN numbers even if they are from the same family.
- The TDS so deducted by the buyer shall be deposited with the Income Tax Dept within 7 days from the end of the month in which the TDS has been deducted
- This TDS is required to be deposited along with Challan No./ ITNS 281 and can be deposited online as well as through various bank branches.
- After the deposit of TDS, the buyer is required to furnish a TDS Return.
- This TDS Return is required to be furnished in Form 27Q and is required to be furnished separately for each quarter in which the TDS has been deducted.
- This TDS Return is required to be deposited within 31 days from the end of the quarter in which the TDS has been deducted
- After the deposit of TDS and filing of TDS Return, the buyer is also required to furnish Form 16A to the seller of property.
What is the Applicability of TDS on Sale of Property by an NRI?
The TDS deduction is different for Long-term & Short-term Capital Gains
- Long Term Capital Gain: 20%
- Short Term Capital Gain: Income Tax Slab Rates of Seller
However, the Effective TDS rate for Long-term Capital gains is levied with additional Surcharge and Health & Ed Cess based on the property value.
Effective TDS rate as per the property value; applicable w.e.f. 1st April 2022 is as follows
- Less than INR 50 Lacs: 20.8%
- INR 50 Lacs – INR 1 Crore: 22.88%
- Above INR 1 Crore: 23.92%
What is Low/ No TDS certificate?
Procedure of Repatriation of Money outside India by a NRI
Is there a way to reduce my TDS liability on funds that I get on selling the property in India
Is my income from selling house in India Taxable in US/ Canada/ UK?
Can I sell my property without coming to India?
Yes possible. Contact us to know more.
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