It may be Frustrating If you are an Indian, Who settled abroad and planning to sell your property In India. We understand your travail. This article will help you to comprehend the process of selling your property in India From Abroad.
Documents needed to sell your property in India from abroad
1. Passport- It acts as identification Proof for the individual involved in the transaction.
2. PAN Card- It is required if one intends to apply for a tax exemption certificate following the Property sale. NRIs from specific countries are assigned PAN numbers that correspond to their foreign address.
3.Tax Returns- If the NRI has profited from the possessions, tax returns for the period of ownership must be kept accessible.
4. Cope with proof- Files in assist or cope within India and abroad should be made available. This includes ration card, phone payments, power bills, life insurance coverage statements, Aadar card, and so on.
5.Sale Deed-A sale deed is a legally binding agreement that governs several activities, such as purchasing and selling legally owned property.
6. Documents From The Society- Files from the society are required to ensure that the vendor has no outstanding payments to the society. An expert certificate certifies that the flat has been occupied, and the allotment letter grants the owner of the property or flat professional authority.
7. Encumbrance certificates- An encumbrance certificate is required to ensure that the assets have no outstanding debts to any crook authority.
The process to sell your property in India from abroad
1. Engage the services of a brokerage firm to conduct a comprehensive valuation of the property and determine its value.
2. Complete all necessary paperwork related to the property's sale. If the person is not physically available, a trustworthy person can be granted PoA to do the necessary.
3. Recognize your tax obligations. Capital gains are taxable in the year the property is transferred, regardless of whether the sale payment was received in full or not.
4. The following are brief explanations of the taxation details:
a. Short-term capital gains tax is applicable if the property is sold within two years (up from three years after Budget 2017), and long-term capital gains tax is applicable if the property is sold within two years.
b. Short-term capital gains are taxed based on an individual's income bracket.
c. Long-term capital gains are taxed at a rate of 20%.
d. When a resident Indian buys a property from an NRI, the buyer is required to deduct TDS at a rate of 20% on long-term capital gains (LTCG). If the property is sold before two years, a TDS of 30% will be deducted. Before deducting TDS, the buyer must obtain a TAN (Tax Deduction and Collection Amount Number).
e. If the property was inherited, the date of purchase by the original owner is used to determine whether the capital gain is long-term or short-term. In this case, the cost of the property will be the cost incurred by the previous owner on the respective property.
5. TDS is deducted at the time the payment is made to the NRI. All information regarding TDS and its rate must be included in the sale agreement between the NRI seller and buyer.
6. The money can only be deposited into an FCNR or NRE/NRO account.
7. The NRI would be tax-free if he or she reinvests the property's capital gains in another property or tax-exempt bonds.
NRI Property management services can help in NRI Property sales and NRI Property Investment in India.