Legal Information: 

Property Purchase Eligibility:

NRIs can purchase residential and commercial properties in India without any restrictions. However, they are not allowed to buy agricultural and plantation properties unless they inherit such properties.

Documents Required:

NRIs need a valid passport, Overseas Citizenship of India (OCI) card, or Person of Indian Origin (PIO) card to transact in Indian properties. They must also provide the Foreign Inward Remittance Certificate (FIRC) as proof of funds received from abroad for property transactions.

Power of Attorney (POA):

NRIs can appoint a trusted person in India as their POA holder to execute property-related transactions on their behalf.

Tax Deduction at Source (TDS):

When NRIs sell property in India, the buyer is required to deduct TDS on the sale value and remit it to the government. The current TDS rate is 20% for long-term capital gains and 30% for short-term capital gains.

Repatriation of Sale Proceeds:

NRIs can repatriate sale proceeds from up to two residential properties. The funds must be held in an NRO account, and there are certain conditions and limits for repatriation.

Inheritance of Property:

NRIs can inherit property in India from resident Indians or other NRIs without any restrictions. However, they should comply with the relevant inheritance laws.

Tax Information: Income Tax:

NRIs are liable to pay income tax in India on income earned from Indian sources. This includes rental income, capital gains, and other income derived from investments in India.

Double Taxation Avoidance Agreements (DTAA):

NRIs can benefit from DTAA agreements between India and their country of residence to avoid double taxation on certain income.

Capital Gains Tax:

NRIs need to pay capital gains tax on the profit made from the sale of property in India. Long-term capital gains are taxed at 20%, while short-term gains are taxed at the applicable income tax slab rate.

Tax Deductions:

NRIs can claim tax deductions on home loans, similar to resident Indians, for the interest paid on the loan and the principal repayment under Section 80C.

Tax Exemptions:

NRIs can avail of tax exemptions on the reinvestment of long-term capital gains in specified bonds or residential properties under Section 54EC and Section 54. It’s essential for NRIs to consult with a tax consultant or a chartered accountant familiar with NRI taxation to ensure compliance with tax laws in both India and their country of residence. The tax laws and rates mentioned above are based on the tax regulations