NRI Selling Property in India: 2026 TDS, Tax and Repatriation

You bought a flat in Pune ten years ago, you now work in Dubai or Toronto, and a buyer has finally said yes. Then the paperwork starts: the buyer's lawyer wants to deduct a big chunk of tax, your bank asks for forms you have never heard of, and nobody can say how fast the money can reach your account abroad. If you are an NRI selling property in India, this guide walks you through the whole sale in plain English.

It reflects the Income-tax Act, 2025 (in force from 1 April 2026), the new no-TAN rule for buyers from 1 October 2026, and the Reserve Bank of India's repatriation rules, all checked on 10 November 2026.

Please note: this article is general information, not professional financial, tax or investment advice. Rules change, so check the official sources linked below or speak to a qualified professional before you decide. Read our disclaimer.

Table of contents

1. NRI selling property in India: who can buy from you
2. NRI selling property in India: capital gains tax
3. TDS on sale of property by NRI: the rule that surprises sellers
4. What changed for buyers on 1 October 2026
5. How to reduce TDS with a Form 128 certificate
6. NRI property sale repatriation: moving the money abroad
7. NRI selling property in India procedure: 8 steps
8. A final checklist before you sign
9. Sources
10. FAQ

NRI selling property in India: who can buy from you

The Reserve Bank of India's FAQ on immovable property says an NRI or OCI can sell residential or commercial property in India to a person resident in India, to another NRI, or to an OCI. Agricultural land, farmhouses and plantation property are different: they can only be sold or gifted to a person resident in India who is an Indian citizen.

As an NRI selling property in India, collect the basics before you list the flat: your PAN, the purchase deed and payment proofs, receipts for improvements, the society no-objection letter, and proof of how you originally paid (bank statements showing NRE, FCNR or foreign remittance). That last item decides how much you can send abroad later, so do not skip it. If you cannot travel, read our sister blog's guide to a power of attorney for NRI property before you sign anything.

NRI selling property in India: capital gains tax

Your tax depends on how long you held the property:

Holding period	Type of gain	Tax rate (2026-27)
More than 24 months	Long-term capital gain	12.5% plus surcharge and 4% cess, without indexation
24 months or less	Short-term capital gain	Added to your income and taxed at slab rates (up to 30% plus surcharge and cess)

For an NRI selling property in India, the gain is the sale price minus the purchase cost, the cost of improvements and selling expenses such as brokerage. Reinvestment exemptions (buying another house in India, or specified bonds) can reduce the gain, but the conditions and section numbers changed with the new Act, so confirm them with a chartered accountant before you rely on them.

Your country of residence may also tax the gain of an NRI selling property in India. Our DTAA guide for NRIs explains how to claim credit for Indian tax so you are not taxed twice.

TDS on sale of property by NRI: the rule that surprises sellers

This is the step that surprises almost every NRI selling property in India. When the seller is a non-resident, the buyer must deduct tax at source under section 393(2) of the Income-tax Act, 2025 (the old section 195). Unlike a resident seller, who faces 1% TDS only on deals of Rs 50 lakh or more, TDS on sale of property by NRI sellers applies from the first rupee, and it is worked out on the sale price, not your gain.

For a long-term property, that means 12.5% plus surcharge and cess on the amount paid: about 13% on payments up to Rs 50 lakh, 14.3% above Rs 50 lakh and 14.95% above Rs 1 crore. For a short-term sale it can exceed 30%.

Simple example: an NRI in Dubai sells a Pune flat for Rs 90 lakh that cost Rs 50 lakh in 2015. Ignoring costs, the long-term gain is Rs 40 lakh and the tax is about Rs 5.2 lakh. Without a certificate, the buyer deducts 14.3% of Rs 90 lakh, roughly Rs 12.9 lakh. More than Rs 7 lakh of your money waits in the tax system until your refund arrives.

What changed for buyers on 1 October 2026

Until 30 September 2026, a buyer had to get a TAN (tax deduction account number) just to pay TDS on a purchase from an NRI, which delayed many deals. Budget 2026 removed that step, which is good news for any NRI selling property in India to a local family. According to the Income Tax Department's Form 141 help page, from 1 October 2026 a resident individual or HUF buyer can deduct and deposit the tax using their PAN through Form 141, Schedule E, and must give you a TDS certificate in Form 132.

Companies, firms and other buyers still need a TAN: they deposit by challan, file the quarterly statement in Form 144 (the old 27Q) and give you Form 131 (the old 16A). Either way, check that your PAN, the price and the TDS amount are correct on the certificate, because that is what your refund depends on.

How to reduce TDS with a Form 128 certificate

The main fix for an NRI selling property in India is a lower TDS certificate. To stop tax being deducted on the full price, apply for a lower or nil deduction certificate. Under the new rules this is Form 128 under section 395(1), filed online on the TRACES portal (it replaced Form 13). You attach a capital gains computation, the purchase and sale documents and recent tax returns. The certificate tells the buyer to deduct at a lower rate that matches your real tax.

• Apply early. A certificate only covers payments made after it is issued, so file as soon as the sale agreement is signed.
• Agree how the buyer is identified. The form asks for the buyer's details; with the new PAN-based route, agree with the buyer in writing how they will be named before you file.
• No certificate? You can still claim back excess TDS by filing an Indian return. Our NRI income tax return guide covers forms and deadlines.

NRI property sale repatriation: moving the money abroad

The last stage for an NRI selling property in India is moving the money abroad. The RBI's rules split your sale money into two parts:

1. Foreign-exchange part. If you bought the property with money sent from abroad, or from your NRE or FCNR account, you can repatriate up to the amount you originally paid in foreign exchange. For residential property this is limited to two properties.
2. Everything else. Gains above that amount, property bought with rupee funds, or inherited property is credited to your NRO account. You can then remit up to USD 1 million per financial year (April to March) from NRO balances and sale proceeds combined, after paying applicable Indian taxes. Larger amounts need RBI permission.

Your bank will ask for the sale deed, proof of original payment, the TDS certificate and the remittance forms. Under the Income-tax Rules, 2026, Form 15CA is now Form 145 and the chartered accountant's certificate Form 15CB is now Form 146 (needed when taxable remittances exceed Rs 5 lakh and you have no tax officer certificate). If you are unsure which account receives what, our guide to NRE vs NRO accounts explains the difference, and our money transfer comparison covers costs between countries.

NRI selling property in India procedure: 8 steps

1. Gather title papers, payment proofs and your PAN; update your KYC with your bank.
2. Get a fair valuation and work out your capital gain with a chartered accountant.
3. Sign the sale agreement (in person on a trip, or through a registered power of attorney).
4. File Form 128 on TRACES for a lower TDS certificate and share it with the buyer.
5. Receive payment into your NRO account; check the buyer deposits TDS through Form 141 (or Form 144 with a TAN).
6. Register the sale deed at the sub-registrar's office and collect Form 132 or 131.
7. File your Indian income tax return for the year and claim any excess TDS as a refund.
8. Ask your bank to repatriate the eligible amount with Forms 145 and 146.

A final checklist before you sign

Being an NRI selling property in India is mostly about timing. Start the Form 128 application the week you agree a price, keep every payment proof from the original purchase, and make sure the buyer knows whether they will use the PAN-based Form 141 route or a TAN. Do those three things and most sellers avoid months of waiting for refunds.

Sources

This guide was checked against these official and reputable sources on 10 November 2026:

• Income Tax Department: Form 141 (challan-cum-statement), including Schedule E for buyers of property from non-residents
• Income Tax Department: FAQs and guidance notes on forms under the Income-tax Rules, 2026 (Form 128, 131, 132, 144, 145, 146)
• Reserve Bank of India: FAQ on acquisition and transfer of immovable property in India by NRIs and OCIs
• Reserve Bank of India: Master Circular on remittance facilities for NRIs/PIOs (USD 1 million facility)
• Business Standard (1 Feb 2026): Budget 2026 removes the TAN requirement for buyers of property from NRIs
• Mint: Buying property from an NRI - TAN rules until 30 September 2026 and what changed from 1 October

Photo: Mumbai posh building society by Yourusernamewillbepublic2, CC0, via Wikimedia Commons (cropped).

FAQ: nri selling property in india

What is the TDS rate when an NRI sells property in India?

For property held more than 24 months, the buyer deducts 12.5% plus surcharge and cess on the sale price: about 13% up to Rs 50 lakh, 14.3% above Rs 50 lakh and 14.95% above Rs 1 crore. Short-term sales attract TDS at slab rates.

Does the buyer need a TAN to buy property from an NRI?

Not from 1 October 2026 if the buyer is a resident individual or HUF. They can deposit TDS with their PAN through Form 141, Schedule E, and issue Form 132. Companies and firms still need a TAN.

How can an NRI reduce TDS on a property sale?

Apply on TRACES for a lower or nil deduction certificate in Form 128 under section 395(1) before the buyer pays. Otherwise, claim excess TDS back by filing an Indian income tax return.

How much money can an NRI repatriate after selling property?

The amount originally paid in foreign exchange can be repatriated for up to two residential properties. Other sale proceeds go to the NRO account and can be remitted within USD 1 million per financial year after paying Indian tax.

Can an NRI sell agricultural land in India?

Yes, but according to the RBI only to a person resident in India who is an Indian citizen. Residential and commercial property can also be sold to NRIs and OCIs.

What documents does an NRI selling property in India need?

Typically your PAN, the purchase deed and payment proofs, society or builder no-objection letters, identity proof, a power of attorney if you are abroad, and bank statements showing how the property was paid for.

Read next

• NRI income tax return: who must file, forms and due dates
• DTAA for NRI: avoid double taxation in UAE, UK, US, Canada
• NRI home loan: eligibility, documents and 7 steps
• More NRI Tax guides

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About the author: Sumit Manwal

Sumit Manwal is the founder of Hospitality Vacancy, the job site built for the hotel industry, which he has run since 2017. With more than 20 years of experience in hospitality, he received the Excellence in Hospitality Sector of Uttarakhand award (January 2023) and the Dainik Jagran inext Uttarakhand Ratan award.

He is passionate about helping hotel management students and hospitality professionals build successful careers, and connects talented people with hotel jobs across India, the Gulf and Europe. On Expat Money Desk he writes clear, practical money guides for Indians and other expats living in the US, UK, Canada, Australia and the Gulf, so every reader can make confident decisions about their work and life. He is not a financial, tax or investment professional, so every guide here links to official sources and he encourages readers to confirm details with a qualified expert before acting.