326. Sell Property in India

before or after renouncing

Indian Citizenship

Q: Dear Mr. Chand, I have been to your website and found it has wealth of information for NRIs. Albeit every case if unique and I have some question unanswered. I have briefly explained my situation below along with my queries: I am NRI living in UK on ILR (permanent residence) and due to apply for UK citizenship in few months time, while at the same time planning to surrender my Indian citizenship. I have invested in two properties in India, both under construction at the moment. Hence, actual possession & registration will happen in about 1+ year time. I have invested monies from sale of another property in India and rest of the moneies were sent from UK for both of the properties i.e. using both NRO & NRE accounts. I intention is to sell both the properties and transfer all the monies from India to UK -> Do I have to sell these properties before I renounce the citizenship of India? or This can be done after I renounce the Indian citizenship? I understand one can apply OCI card -> Is the selling property and transfer all of monies from sale proceed from India to UK can be done once I obtain OCI card? What type/percentages of taxes do I have to pay in India, apart from Capital Gains (from profit on Sale) to get the monies transfer to UK? I will highly appreciate if you can please advise on the above. Also If you can suggest someone who can assist me with this matter, please provide me the detail and I will be in touch. Many thanks, Narinder Sharma A. When you sell your properties is matter of choice as it normally does not make much of a difference. Let me clarify. Your status currently is that of a Non-Resident Indian (NRI). Once you become a foreign citizen, your status will become Person of Indian Origin (PIO) Nri's can sell their property in India to A person resident in India; or Another NRI or A Person of Indian Origin (PIO) On the other hand, PIO can sell their residential and commercial property to: A person resident in India; or An NRI; or Prior approval of the Reserve Bank of India is required to sell to a PIO (This is the difference you will encounter) As far as repatriation of sale proceeds of property once you sell it is concerned, whether you have OCI or not makes no difference. The rules to repatriate are the same. The money goes into an NRO account and on submitting proof, from a chartered accountant that taxes have been paid a sum of up to One Million per financial year can be repatriated. Capital gains are classified as either short term or long term. When property is sold after at least three years of ownership, long term capital gains apply. Short term capital gains are taxed @ 20% whereas short term capital gains @ 30.9%.