Informing educating and connecting Indians across the globe . . . by Virendar Chand
REPATRIATION OF SALE PROCEEDS OF PROPERTY SOLD IN INDIA
How to transfer money from property sale in India to overseas bank account
Repatriation of the sale proceeds is allowed if:
1.The property is sold at least three years after acquisition.2.The property was acquired in accordance with the provisions of foreign exchange laws in force when the property was purchased.3.The amount that can be repatriated will be up to the amount submitted in foreign exchange through normal banking channels when the property was purchased.4.In case the properties that are sold are residential properties. Then repatriation is allowed only twice.5.In case a property was received by way of inheritance then permission of the reserve bank may be required.6.In case a property was paid for in Rupees then ownership must have been for at least ten years.7.In the event the ten year period has not been reached. The money from the sale proceeds can be deposited by Non Residents in their NRO bank accounts and once the ten period is reached they can transfer the sale proceeds subject to payment of all due taxes.8. A certificate in the prescribed format may be required from a CA to confirm that the money indeed deposited in the NRO account is from the sale proceeds of legally owned property. It is therefore of utmost importance that NRI’s when they sell property in India to accept payment only via legal banking channels. Accepting cash payments is certainly not recommended in India.NRI’s/ PIO’s are allowed to repatriate an amount up to USD one million, per financial year (April-March), out of the balances held in the Non-Resident (Ordinary) Rupee (NRO) account, subject to compliance with applicable tax requirements.
Transferring Money from India from sale of inherited property
NRI’s or PIO’s who inherit property from a person resident in India and sell it, can transfer the sale proceeds abroad. Up to one million US Dollars per calendar year subject to production of documentary evidence to support their inheritance of the property and the necessary tax clearance certificates from the appropriate income tax authority.