John

Investment in Real Estate for NRIs

India is one of the most exciting emerging markets in the world. Skilled managerial and technical manpower that matches the best available in the world and a sizeable middle class provide India with a distinct cutting edge in global competition. India’s time tested institutions offer foreign investors a transparent environment that guarantees the security of their long term investments. A number of liberalization measures have been taken to promote portfolio foreign investment. NRIs are entitled for the following :

1. All persons, whether resident in India or outside India, who are citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan require prior permission of Reserve Bank for acquiring or transferring any immovable property in India.

2. A person resident outside India, who has been permitted by Reserve Bank to establish a branch, or office, or place of business in India has general permission of Reserve Bank to acquire immovable property in India, which is necessary for, or incidental to, the activity. However, in such cases a declaration is required to be filed within 90 days of the acquisition of immovable property.

3. An Indian citizen resident outside India does not require any permission to acquire any immovable property in India other than agricultural/plantation property or a farm house.

4. An Indian citizen resident outside India does not require any permission to transfer any immovable property, to a citizen of India who is resident in India.

5. An Indian citizen resident outside India does not require any permission to transfer any immovable property other than agricultural or plantation property or farm house, to a person who: -

• Is a citizen of India resident outside India
• Is a person of Indian origin resident outside India

Tanuj

Hi John !!!

and thanx for the interesting info ...

can u pls tell us smthng abt the rent procedures for the nris..

actually i ws wondrng if my aunt could rent out her flat in Ardee City in Gurgaon....they have settled abroad and was looking for renting out the place...

pls suggest ....

Aadesh

Hello Tanuj,
Just came across your query. Your NRI aunt can definitely rent out her property in India.

Here are a few pointer regarding rental income for NRIs:

• NRIs can freely rent out property, source of acquisition of property not significant.
• Freely repatriate rental income without prior permission.
• Tax deducted at source on rental income, freely adjust rental income against home loans.
• If loan amount is higher, pay through NRE, NRO and FCNR accounts.
• NRIs/PIOs can take the advantage of indexing the cost of acquisition and improvement, investing of sale proceeds in special Bonds
• On deciding to sell the rental property the NRI can apply to the Income tax authorities for the certificate to be deducted at source.