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Most NRI sellers arrive with the tax question answered and the process question untouched. The tax is arithmetic your chartered accountant will do. The close is where these files actually fail.
Author
Ashutosh Bhogra
Category
NRI
Read time
6 min read
Published
31 July 2026 · Updated October 2026
Most NRI sellers arrive with the tax question answered and the process question untouched. The tax is arithmetic your chartered accountant will do. The close is where these files often become delayed.
This article concerns process, not tax advice. The statutory position depends on the seller’s residential status, title, payment structure and timing. Take the final transaction structure to your chartered accountant and property counsel.
## Title papers Start here. The three problems we see most often with owners abroad: the older sale deeds, back to the first owner, are missing; there is a will but no registered no-objection from brothers and sisters; the house is divided by floors with no share of the land written down, which needs new registered papers. Fix these before the property is offered to anyone. ## Power of attorney
Most owners fly down once and close the sale themselves, and many buyers prefer that. If you cannot come, somebody must be able to act for you. A power of attorney signed abroad is notarised and apostilled where you sign, then stamped in Delhi before use — not registered. The stamping in Delhi takes a few days. Check first that the buyer will accept it.
Confirm rather than assume. The name on the PAN should be reconciled with the title documents, particularly if the property was acquired before a marriage or a name change.
Withholding on a non-resident seller is deducted under the applicable statutory framework and is materially different from the one per cent rule for a resident seller under section 393(1) (earlier section 194-IA). If actual tax liability may be lower than withholding, a lower deduction certificate can reduce the amount withheld upfront. Applying in the closing week is not a workable plan.
Consideration should move through the agreed banking channel. The deed, payment trail and tax documentation need to be consistent. This is important at closing and at a later sale, when the next buyer will review the title and payment trail.
After deduction and deposit, obtain the applicable TDS certificate and records. They may be needed to claim credit in the seller’s Indian tax return and to support reporting in the country of residence, subject to advice in that jurisdiction.
Since 1 October 2026, a resident individual or HUF buying from a non-resident seller does not need a TAN. The buyer deducts the tax, pays it and reports it with their PAN on Form 141, Schedule E. This does not cover a company, firm, LLP or non-resident buyer; they still need a TAN. Ask the chartered accountant on the deal to confirm the route before the first payment.
A residential floor in a South Delhi colony is not the same as agricultural land, plantation property or a farmhouse. These can attract a different FEMA and land-use analysis. Confirm the position on the specific title with counsel rather than reasoning from a master-plan provision to a foreign-exchange rule.
Union Budget 2026 speech — PAN-based challan proposal
Income Tax Department — TDS guidance for purchase of immovable property
Grey Beard Real Estate
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