Selling a Plot as an NRI and Taking the Money Out of India

When the proceeds can be repatriated

The RBI's Master Direction on immovable property lets a bank allow a non-resident seller to repatriate the sale proceeds when all three of these hold:

1. 01The property was acquired under the foreign exchange law in force at the time.
2. 02It was paid for in foreign exchange received through banking channels, or from an FCNR(B) or NRE account.
3. 03For residential property, repatriation is limited to not more than two such properties.

The USD 1 million route from NRO

Where those conditions are not met — a plot paid for from an NRO account, for instance — the RBI's Master Direction on remittance of assets lets banks allow an NRI to remit up to USD 1 million per financial year out of NRO balances, sale proceeds of assets and inherited assets. Anything above that needs the RBI's prior approval. Since June 2026 the limit also covers transfers to NRE and SNRR accounts.

Tax the buyer deducts

A buyer paying a non-resident seller deducts tax at source. For sales from 1 April 2026 the deduction falls under section 393 of the Income-tax Act, 2025; before that, under section 195 of the 1961 Act. The Income Tax Department's guidance gives 12.5% on a long-term gain — property held more than 24 months, transferred on or after 23 July 2024 — and 30% on an individual's short-term gain, before surcharge and cess.

The Department also states that the option of 20% with indexation for property bought before 23 July 2024 applies only to resident individuals and HUFs, not to non-residents. Take a chartered accountant's advice before you sign, here and where you live.

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