Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs) can invest in Indian real estate with certain regulations in place. The Pink City is becoming a sought after location for Real Estate investors and thus, understanding the exchange control implications and legal aspects is crucial before making a purchase. However, worry not, for we are here to simplify your dream of reconnecting to your roots.
Direct Purchase
NRIs and PIOs can buy real estate in India, except for agricultural land, farmhouses, and plantation properties. Key aspects include:
- No restriction on the number of properties they can purchase.
- Payment must be made through funds received via normal banking channels or from an NRI account under FEMA regulations.
Acquisition Through Gift
- NRIs and PIOs can receive real estate as a gift from Indian residents, NRIs, or PIOs.
- Indian stamp duty laws will be applicable.
Acquisition Through Inheritance
- NRIs and PIOs can inherit property from residents or non-residents, provided the original acquisition complied with exchange control regulations.
Investment Options for Foreign Nationals
- Foreign nationals, except NRIs and PIOs, are generally not allowed to buy property in India.
- Joint ownership with an Indian citizen is not permitted.
- Citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, and Bhutan require prior RBI approval to purchase property.
- Foreign nationals can sell or gift property to Indian citizens, NRIs, or PIOs with RBI approval.
Key Legal Considerations
Apart from exchange control regulations, NRIs and PIOs must consider:
- Tax Laws: Capital gains tax, rental income taxation, and TDS rules apply.
- Succession Laws: Property inheritance laws vary based on religion and region in India (e.g., Hindu Succession Act vs. Muslim Personal Law).
- Repatriation Rules: Profits from property sales can be repatriated under RBI guidelines, subject to conditions.
FAQs
1. Can NRIs and PIOs buy property in India?
Yes, NRIs and PIOs can buy residential and commercial properties in India, except for agricultural land, farmhouses, and plantation properties.
2. How can NRIs make payments for property purchases in India?
Payments must be made through funds received via normal banking channels or from an NRI account under FEMA regulations. Cash payments are not allowed.
3. Are there any restrictions on the number of properties NRIs can buy in India?
No, there are no restrictions. NRIs and PIOs can buy multiple residential or commercial properties in India.