Q.1206 Query for Home and

Home Loan for NRI and PIO

Question: Dear Sir, I came across to your website recently and I found it very very helpful for the Indians living abroad. I have few queries on the NRI and PIO. Currently, I am living on Canada as Permanent Resident and I have a property on India (Home) and I have a Home loan also. If I become Canadian Citizen, then I have to surrender my Indian Citizenship. After surrendering Indian Citizenship, can I still sell my property and transfer the money to my foreign bank account. Will the tax be more if we sell after surrendering Citizenship. Are there any legal issues for having Home Loan after surrendering Indian Citizenship Thank you in advance. Thanks. Answer: House loan you took prior to becoming non-resident would continue. Accepting foreign citizenship would have no effect on your housing loan. You can send the loan payments from Canada or pay from your NRO bank account in India. On becoming a foreign citizen there are no restrictions on continuing to hold or sell property owned in India prior to becoming a non-resident. You can hold your property or sell it and get the sales proceeds transferred abroad after paying the taxes due. In case you rent your property you also have the option of transferring the rental amount abroad. Regarding your question if tax on the sale of your property will be more if you sell after acquiring foreign citizenship? The answer is no! However the TDS deduction is higher when property of an NRI or PIO is sold. In the end when final capital gains on the sold property are calculated, any excess deduction is refunded when a tax return is filed. More information on TDS on property sales in India are provided on Nri Information. Here is the link: http://nriinformation.com/articles5/tds_nri_pr operty_sale.htm