NRI Property Tax Services Mumbai
India-specific preparation guide
NRI Property Tax Services Mumbai needs current-law checks, portal verification, documents and a precise brief before you compare experts on WorkIndex.
Post Your Requirement - FreeTDS on NRI Property Sale & Rental Income (Section 195)
TDS on payments to NRIs is governed by Section 195 of the Income-tax Act, 1961. Unlike resident transactions, there are no basic exemption thresholds for NRI TDS.
| Transaction type | TDS Rate & applicability | Key requirement |
|---|---|---|
| TDS on Rent (Section 195) | 31.2% TDS (30% tax + 4% cess) applied to gross rental income. | No basic limit of Rs. 2.4 Lakh. Tenant must obtain a TAN to deduct and deposit this tax. |
| LTCG Property Sale TDS | 20.8% TDS (20% tax + 4% cess + applicable surcharge) on gross sale value. | Applies if the property was held for more than 24 months. Indexation rules apply based on acquisition date. |
| STCG Property Sale TDS | 30.9% to 42.74% TDS on gross sale value depending on the slab. | Applies if the property was held for 24 months or less. |
| Lower TDS Certificate (Section 197) | Application via Form 13 on the e-filing portal to reduce TDS rate. | Enables the buyer to deduct TDS only on the actual capital gains rather than the total sale value. |
Capital gains exemptions and buyer obligations
- No 50 Lakh Threshold: Unlike resident property sales where TDS is 1% under Section 194-IA (only if sale > 50 Lakh), NRI property sales are subject to TDS on the entire sale price under Section 195.
- Section 54 Exemption: NRI can save LTCG tax by investing in another residential house property in India (capped at Rs. 10 Crore).
- Section 54EC Exemption: NRI can save LTCG tax by investing in NHAI/REC capital gains bonds within 6 months of sale (capped at Rs. 50 Lakh).
- Buyer TAN Obligation: The buyer must obtain a TAN to deduct NRI TDS under Section 195 and file Form 27Q quarterly.
Documents for property sale or rent tax filings
- Purchase deed and date of acquisition.
- Sale agreement / sale deed draft.
- Cost of improvement details (renovation, building, etc. with invoices).
- Form 13 Lower TDS certificate (if obtained).
- TAN certificate of the buyer or tenant.
NRI Property Tax Services Mumbai: year and source check
Last fact-checked: 18 June 2026.
AY 2026-27 means FY 2025-26 income and is filed under the Income-tax Act, 1961. Tax Year 2026-27 means FY 2026-27 income under the Income Tax Act, 2025. Do not mix the two.
Verify stay days, TRC validity, DTAA rates, NRO interest, and Form 15CA/15CB requirements against official CBDT guidelines, notifications, and portal utilities before taking a filing position.
FAQs
What is the TDS rate when buying a property from an NRI?
The TDS rate is 20.8% for Long-Term Capital Gains (held > 24 months) and 30.9% (or higher depending on surcharge) for Short-Term Capital Gains, deducted on the total sale consideration.
How can an NRI seller avoid high TDS on property sales?
The NRI seller can apply online for a Lower TDS Certificate under Section 197 using Form 13 on the e-filing portal. This directs the buyer to deduct tax only on the estimated capital gains instead of the entire sale price.
Does a tenant have to deduct TDS when renting from an NRI landlord?
Yes. Under Section 195, the tenant must deduct TDS at 31.2% on the gross rent, irrespective of the rent amount. The tenant must also obtain a TAN (Tax Deduction and Collection Account Number) to deposit the tax.