- NRIs can buy residential and commercial property without RBI permission.
- There is no limit on the number of properties.
- Agricultural land, plantations and farmhouses cannot be bought or received as a gift; they can be inherited.
- Payment must come through normal banking channels or NRE, FCNR or NRO accounts.
On this page
Can NRI buy property in India: what is allowed
| Property | Buy | Gift from a relative | Inherit |
|---|---|---|---|
| Flat or house | Yes | Yes | Yes |
| Office or shop | Yes | Yes | Yes |
| Non-agricultural plot | Yes | Yes | Yes |
| Agricultural land | No | No | Yes |
| Plantation or farmhouse | No | No | Yes |
How must an NRI pay?
Through money received in India by normal banking channels, or from an NRE, FCNR or NRO account. Payment in foreign currency notes or by travellers' cheques is not allowed. NRI home loans from Indian banks are permitted.
Do OCI cardholders have the same rights?
Largely yes for buying residential and commercial property. See can OCI buy property in India.
What about property owned before becoming an NRI?
Property acquired while resident, including agricultural land, can continue to be held after you become an NRI. See can NRI own property in India.
Checks before an NRI buys
- A title search on the property, at least thirty years back.
- RERA registration for a new project.
- Approvals and the occupancy certificate for a built property.
- That the seller is not an NRI; if they are, you must deduct tax at source.
- A specific, limited power of attorney if someone in India will sign for you.
Mistakes NRI buyers make
The most common are paying a token amount before any title check, paying part of the price in cash, giving a relative a broad general power of attorney, and assuming that a plot sold as farmland can be bought because the seller says it has been converted. Each of these can cost far more than the legal fees saved.
How do NRIs register property?
Registration happens at the sub-registrar's office of the area, in person or through an attorney holder with a properly stamped power of attorney. The NRI needs a PAN and passport or OCI card. After registration, update the municipal, society or land records so that the property shows in your name.
Tax on property for NRIs, in brief
Rent from Indian property is taxed in India, with tax deducted by the tenant. On sale, the buyer deducts tax at source at non-resident rates, and long-term gains are taxed at 12.5% plus surcharge and cess without indexation. A tax adviser should confirm the position for your case.
Where to go next
- The full rules: NRI rules for buying property.
- The process from abroad: NRI buying property in India.
- Land: can NRI purchase land.
Founder and Managing Partner, VIVS Legal. BLS, LL.B, LL.M, PGDBM, JAIIB.
