Selling a property in India can be a lucrative proposition, especially for non-resident Indians (NRIs) who own properties in India. However, there are certain limitations on the repatriation of money from India to foreign countries. In this article, we will explore the various scenarios and limitations on the repatriation of money from India when selling a property.
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There are three scenarios when it comes to selling a property in India: the property was acquired using Indian income when the seller was a resident; the property was bought using foreign currency after the seller became a non-resident; or the property is inherited from the seller’s parents.
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If the property was procured using foreign currency, then the repatriation of money is limited to the amount invested in the property. For example, if the property was acquired for INR 1 crore and sold for INR 2 crore, then the maximum amount of money that can be repatriated is INR 1 crore. This is a simple rule that applies to all NRIs selling property bought using foreign currency.
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When the seller was a resident and used Indian income to buy the property, there are no limitations on repatriating the amount of money However, if the seller has permanently shifted to a foreign country, then there is a limit of USD 1 million per year on the repatriation of money. This limit does not apply if the seller is still a resident of India.
There are no limitations on repatriating the amount of money if the seller inherits the property from their parents. However, the seller is subject to a limit of USD 1 million per year on the repatriation of money.
Summary
In summary, the limitations on repatriation of money when selling a property in India depend on the scenario in which the property was acquired. If the buyer purchases the property using foreign currency, the repatriation of money is limited to the amount invested in the property. Just as the property was acquired using Indian income, then there are no limitations on the amount of money that can be repatriated, except for a limit of USD 1 million per year if the seller has permanently shifted to a foreign country. If the property was inherited, then there are no limitations on the amount of money that can be repatriated, but the seller is subject to a limit of USD 1 million per year.
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