NRI Buying Property in India — Documents, Tax & RBI Rules (2026 Guide) | 99Land

An NRI can buy almost any property in India — but not quite all of it. Here's exactly what you can and can't buy, the FEMA and RBI rules, the documents you need, tax on purchase, repatriation rules, and how to do it without traveling.

You're an NRI looking to buy property in India. Maybe it's a flat in your home city for when you eventually return, or an investment property to generate rental income, or just a way to keep your family back home in a place you partly own. Whatever the reason, the rules have stabilized over the last decade and the process — while paperwork-heavy — is actually doable without setting foot in India.

This guide walks through what's permitted, what isn't, the tax obligations, the financing options, and how to execute remotely.

Important: Tax laws and FEMA regulations change. This guide covers the 2026 baseline. Have a Chartered Accountant verify specifics before any transaction.

Who is an "NRI" for property purposes?

For Indian property law and FEMA:

NRI (Non-Resident Indian) — Indian citizen residing outside India
OCI (Overseas Citizen of India) — Foreign citizen with OCI card
PIO (Person of Indian Origin) — older category, now generally absorbed into OCI

All three categories have substantially the same property buying rights under FEMA. Foreign citizens without OCI status face heavier restrictions and are not covered here.

What you CAN buy

Under FEMA and the Reserve Bank of India's master directions:

Residential property — flats, independent houses, villas
Commercial property — shops, offices, commercial complexes
Any number of either; no quantity cap

You can hold them, rent them out, sell them, or gift them within rules.

What you CANNOT buy

There are three categories of restrictions:

Agricultural land — flat ban. NRIs/OCIs cannot purchase agricultural land in India. Even if you have ancestral roots in farming or someone offers to "transfer" it to you, RBI does not allow this acquisition.

Plantation property — banned (tea estates, coffee, rubber, etc.).

Farm houses — banned. A "farm house" in legal terms is a residential structure on agricultural land. NRIs cannot buy them.

The one exception: inheritance. You can inherit agricultural land or a farm house from a resident Indian. You can also acquire by way of gift from a close relative who is an Indian resident, subject to FEMA approval. But you cannot purchase these for money.

If a seller offers you "agricultural" land that's "actually used for residential purpose," walk away. The legal classification on patta/khata is what matters, not how it's being used.

Funding the purchase — your three options

NRIs can fund Indian property purchases through:

Option 1: NRE / NRO / FCNR accounts

NRE (Non-Resident External): holds your foreign earnings in INR; fully repatriable
NRO (Non-Resident Ordinary): holds Indian income (rent, dividends); repatriation capped at USD 1M per FY
FCNR (Foreign Currency Non-Resident): holds foreign currency deposits

You can pay for property from any of these. What you pay from determines later repatriation rules — see the repatriation section below.

Option 2: Inward remittance from abroad

You can wire money from your overseas account to the seller (or to an NRE/NRO account first, then onward). This is the most common path. Use formal banking channels — never cash.

Option 3: Home loans from Indian banks

Many Indian banks (SBI, HDFC, ICICI, Axis, Bank of Baroda, etc.) offer NRI home loans. Typical terms:

LTV: 70-80% of property value (lower than for resident Indians)
Tenure: up to 30 years OR until age 60-65, whichever is earlier
Rate: generally 0.25-0.5% higher than resident rates
Repayment: EMIs from NRE/NRO/FCNR account
Documentation: passport, visa, work permit, salary slips, employment letter, tax returns from country of residence

Loans help you preserve foreign capital and use leverage. Especially useful for investment properties.

What you CANNOT use for payment

Cash — never, for any amount, under any circumstance
Money from another NRI's account — must come from your own funds
Money paid into seller's account directly from a foreign source without proper FEMA declaration — this gets flagged

Always route through Indian banking channels with clear paper trail.

Documents required

For the NRI buyer:

Passport (with visa pages)
OCI card (if applicable)
PAN card (mandatory for any property transaction)
Address proof in country of residence
Address proof in India (parent's address with no-objection is acceptable)
Photographs (passport-size)
Bank statements from NRE/NRO/FCNR
Income tax returns from country of residence (for loan)
Salary slips / employment letter (for loan)

If you can't be present in India for registration, you'll need:

Power of Attorney (POA) — a notarized & apostilled POA giving someone in India (typically a family member or lawyer) the authority to register the sale on your behalf
POA must be specific to the property and notarized at the Indian embassy/consulate where you reside

The Power of Attorney process — done right

This is where most NRI transactions slow down or go wrong. The POA must be:

Specific: name the exact property, the seller, the purpose (purchase + registration)
Notarized at the Indian embassy/consulate in your country of residence
Apostilled if your country is a Hague Convention signatory (US, UK, Australia, most of EU)
Sent to India for stamping at the sub-registrar's office (state stamp duty applies — typically ₹2,000-₹15,000)
Adjudicated if required (some states require an additional stamp adjudication)

Build in 4-6 weeks for the POA process. Rushing it leads to rejection at registration.

Many NRI buyers appoint a real-estate lawyer in the property's city as their POA holder rather than a family member. This avoids family awkwardness if anything goes wrong.

Stamp duty, registration, and TDS

When buying, you pay:

Stamp duty: state-dependent, typically 5-8% of property value
Registration fee: typically 1% of property value
GST (only on new under-construction): 5% (1% for affordable)
NO additional "NRI premium" — same rates as resident buyers

TDS on property purchase (paid BY you, the buyer, to the seller's account):

If seller is resident Indian: 1% TDS on transactions above ₹50 lakh
If seller is NRI: significantly higher — 20-30% TDS on the capital gains portion (not the full price). The seller must obtain a "Lower Deduction Certificate" from the Income Tax Department to reduce this. Without it, the buyer is required to withhold the full statutory rate.

For NRI-to-NRI transactions, get a tax advisor involved early. The TDS rules are strict and the buyer is personally liable if they fail to deduct.

Tax obligations after buying

Once you own Indian property as an NRI:

Annual property tax to the municipal authority (₹2,000-₹50,000 typically depending on location and size)
Income tax on rental if you rent it out — taxed at slab rates (currently up to 30%); but you can claim a 30% standard deduction and full home loan interest deduction
TDS on rent — if rent exceeds ₹50,000/month, tenant deducts 30% TDS and remits to IT department
Wealth tax — abolished since 2015; no wealth tax on Indian property

File ITR (Income Tax Return) in India annually if you have any Indian income (rent, capital gains, FD interest). This is mandatory for NRIs with Indian source income above ₹2.5 lakh.

Repatriation — getting money back out

This is what most NRIs care about: if you sell later, can you take the money back to your country of residence?

Rules:

Property acquired with foreign exchange (NRE/inward remittance): Sale proceeds can be repatriated up to the amount originally remitted (after taxes). Capital gain portion can also be repatriated within limits.

Property acquired with NRO funds (Indian source income): Sale proceeds can be repatriated only up to USD 1 million per financial year (under the existing RBI rule). This is a per-NRI limit, not per-property.

Property acquired by gift / inheritance: Same USD 1M annual limit applies.

Maximum 2 residential properties: Repatriation of sale proceeds is permitted for up to 2 residential properties in a lifetime (verify current limit).

Whatever the limit, repatriation requires:

Form 15CA and 15CB filed by a Chartered Accountant
TDS payment proof
Bank's authorized dealer review of FEMA compliance

Build in 2-4 weeks for repatriation after sale.

Buying without travelling — is it possible?

Yes, end-to-end remote purchases are possible:

Shortlist properties online via platforms like 99Land
Virtual site visits via video — most agents will do this on WhatsApp/Zoom
Engage a local lawyer for title check, agreement vetting
Engage a local CA for tax planning, TDS, POA stamping
Execute the POA at your country's Indian embassy
Send POA to India for stamping
Wire funds through banking channels
POA holder registers the property on your behalf

The "remote" path adds 1-2 months to the timeline and ₹50,000-₹2,00,000 in legal/CA fees. Many NRI buyers find this preferable to taking a 2-week trip.

Common mistakes NRIs make

Trusting family verbally without legal documentation — the most common cause of family disputes
Buying agricultural land "informally" — illegal under FEMA, can be reversed
Using a generic POA — must be specific to the property
Skipping the EC and title verification because the seller is a family friend
Not factoring in TDS when the seller is also an NRI
Buying in a relative's name "for simplicity" — creates ownership and tax complications

Buyer's checklist for NRIs

☐ PAN card obtained
☐ NRE / NRO account active in an Indian bank
☐ POA prepared, notarized, apostilled, ready to send to India
☐ Property is residential or commercial (NOT agricultural)
☐ RERA registration verified (for under-construction)
☐ Title chain verified for 30 years by an Indian lawyer
☐ EC pulled and clean
☐ TDS plan in place (especially if seller is an NRI)
☐ Indian CA engaged for tax planning + Form 15CA/CB
☐ Source of funds clearly documented for FEMA

TL;DR

NRIs have full property buying rights in India for residential and commercial real estate. The hard parts are:

Funding through proper banking channels (no cash, no informal transfers)
Executing the POA properly if not present
Managing TDS, especially when the seller is also an NRI
Understanding repatriation limits for any future sale

Done right, the whole process takes 3-6 months. The cost of engaging a local lawyer + CA is ₹1-3 lakh total — small compared to the value of getting it right.

To start your shortlist, browse apartments in Bengaluru, Chennai, or villas in Hyderabad on 99Land. Filter by verified agents — they'll handle paper-heavy NRI documentation more smoothly. Connect with our verified property agents before flying down (or instead of flying down).

India lets you buy as a non-resident. The country wants your investment. Just follow the paper trail — every step of the way.

Safety checklist for everyone in this deal

A property transaction in India touches a lot of hands. Here's what each party should insist on before money moves.

Buyers

Verify title through a 30-year EC (Encumbrance Certificate) and cross-check the mother deed.
Confirm RERA registration (where applicable) — the RERA number should match the one on the state RERA website.
Never transfer a token amount on WhatsApp alone; insist on a receipt and a simple written agreement.
Walk the property in person. Photo-only deals are a common vector for listing fraud.

Sellers

Keep originals in a locker. Only ever share certified copies with prospective buyers.
Insist on payment via cheque / NEFT / RTGS — avoid cash-heavy deals, especially above ₹2 lakh (20,000 cash cap for each leg under Section 269ST).
Never hand over vacant possession until the sale deed is registered and the registration receipt is in your hand.

Agents, agencies and brokers

Register under the state RERA (where brokering RERA-covered projects) and display your registration number on listings.
Keep a written, dated engagement letter with the client covering brokerage %, exclusivity and a cancellation clause.
Do a KYC on both sides before the first site visit — PAN + Aadhaar, photo ID match — and hold a copy on file.
Never pocket earnest money directly; let it flow buyer ↔ seller and invoice the brokerage separately.

Owners

Update your property tax every year — BBMP / MCD / BMC arrears follow the property and surface at sale time.
On rental, include a 2–3-month notice period, a detailed inventory with photos, and a clause on painting + deep-cleaning at exit.
Pay the rental TDS if you're a tenant paying over ₹50,000/month (Section 194-IB). Owners should chase the Form 16C from their tenant.

Final tip: when in doubt, walk away. The best real-estate deals are the ones you don't rush.