How Many Properties Can an NRI Own in India?

Confused about the rules regarding property purchases in India for NRIs? Well, you are at the right place. Stay tuned till the end to get your doubts resolved.

Purchasing property in a country like India is a complex process and the complexity further multiplies for Non-Resident Indians who are fresh to many procedures and rules that need to be followed to acquire a property. Still, the Indian Property market has been influenced by Non-Resident Indian or NRI for many years. Some NRIs sought land and other properties as a lucrative option for investment and also to establish a connection with their homeland, while some NRIs invested in properties to transform them into a place where they can reside with peace once they retire.

Vakilsearch provides NRI legal services ranging from taxation services, getting a lawyer, litigation services, and NRI property matters to simple legal assistance or commercial services. Vakilsearch is the one-stop solution for any kind of legal matter, be it for an NRI or an Indian citizen.

NRIs have to undergo certain processes and follow some rules and regulations in order to acquire land in India. These complex processes give rise to doubts and misconceptions which can lead to fraud and other similar situations. In this article, we have tried to resolve a maximum of the property-related doubts that NRIs most commonly face.

Table of Contents

Can NRI Purchase Property in India?

Well, the answer to this question is variable. There are certain limitations on NRIs purchasing land or property in India.

NRIs can purchase land or property in India, but the land/property shouldn’t be agricultural property, a farmhouse, or a plantation property. The purchase is limited to residential or commercial properties.

How can NRIs Purchase Property in India?

For the purchase of any residential or commercial property, NRIs do not need to have any kind of special permission from any government body like RBI. But if the NRI desires to purchase an agricultural property, he/she needs to seek proper permission from the RBI. This permission is granted on a case-to-case basis.

Documents Required to Purchase Property

Passport or OCI card – you need to show your passport or PIO (Person of Indian Origin) or OCI (Overseas Citizen of India) card if you hold a foreign passport.
PAN Card – it is a mandatory document required for any kind of property purchase in India.
Power of Attorney – This document is required only if due for some reason, you are unable to complete the formalities necessary for purchasing the properties by yourself. In such condition, you may appoint a power of attorney (duly registered and notarized) that would complete the formalities on your behalf.
RERA registration papers
Title Deeds (in the name of the seller)
NOC from the local bodies

How Many Properties can NRIs Purchase in India?

Currently, there are no restrictions on NRIs for purchasing property in India. An NRI can own multiple residential and commercial properties in India.

Rules on the payment that can be made for the purchase of properties:

There are certain rules that need to be followed while making the payment for the purchase of property by NRIs.

The amount cannot be paid in the form of foreign currency, or traveller cheques.
The amount should be made in India. No payment should be processed outside of India.
The payment must be made through banking channels in Indian currency (₹Rupees) only.
According to the FEMA and RBI regulations, the amount to be paid should be maintained under a Non-Resident bank account.

NRIs are also free to avail of home loans to purchase a property if they desire.

What are the Tax Implications Applicable to the Property Purchased by NRIs?

NRIs also have to pay property tax on the purchased asset just like any other taxpayer in India.
If the NRI decides to rent the property, there is a 30% TDS applicable on the rental income.
Depending on the type of capital gains (short-term or long-term), there is a TDS applicable between 20% to 30% on the amount earned on selling the immovable property.

Some More Things that You Need to Keep in Mind

Along with the above-mentioned set of rules, there are a few more things that you need to keep in mind-

An NRI can purchase land/property in a joint venture but the partner should be either a Person of Indian Origin (PIO) or an NRI or a resident Indian. No other foreign national is allowed while making a joint purchase.
If you owned certain agricultural property or a farmhouse before becoming an NRI, you can continue to hold it.
NRIs can also let out their owned property for rent irrespective of the type of property and the time it was acquired. Tax as applicable should be paid on such earnings.

As you can see, there is a big list of rules and regulations which is out of the scope of this article. So it’s clear that to deal efficiently in the property market in India, you need to have a good amount of knowledge of taxation laws. As the legal scenario is constantly updating, you also need to stay updated. Vakilsearch, one of the leading legal service providers in India provides A to Z NRI legal services.

Vakilsearch helps you better handle your legal scenarios and also provides you with legal assistance whenever you need it. From the property acquisition process to taxation services, Vakilsearch covers it all. With the help of legal services provided by Vakilsearch, you can resolve many of your legal concerns without having to travel at all. This helps you to save a lot of money and time.

Conclusion

There are several concerns that may arise while purchasing new land or property, and these concerns increase pretty higher in the case of NRIs. Though the legal procedures have now started to become simple and quite fast, there are still several complications in the system that requires proper legal guidance. Vakilsearch is a leading provider of legal services for NRIs in India that tries to cover most of the legal scenarios a common man can come across. So connect with Vakilsearch today and get all your legal queries resolved.

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