• OCI selling property in India to another OCI

Hi - if OCI sells property to another OCI can the proceeds be received directly abroad ? tax declaration would be required in both countries.
Asked 4 years ago in Taxation

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14 Answers

The property can be sold to other OCI the buyer has to deduct TDS and deposit with the department as the capital gain is in India You will get the benifit of tax only when there is Double taxation avoidance agreement with your resident country.

The proceeds has to be recieved in India as the transfer is taking place here.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

Dear client,

1. The property can be sold to the other OCI the buyer has to deduct TDS and deposit with department as the capital gain is India you will get the benefit of tax only when there is double taxation avoidance agreement with your resident country.

Koushalya Pattan
Advocate, Bangalore
174 Answers

Not rated

You have not mentioned whether it is residential or commercial or agricultural property being sold by you

An NRI holding agricultural land, plantation land or farm house may sell these properties only to a person resident in India and who is a citizen of India.

3) sale proceeds of property have to be deposited in NRO account

4) sale proceeds cannot be received abroad

Ajay Sethi
Advocate, Mumbai
87976 Answers
6207 Consultations

5.0 on 5.0

It will be applicable as per International Law and Hague Convocation that tax will applicable according that respective country.

It will be great if you provide country name. India and ???

Ganesh Kadam
Advocate, Pune
12338 Answers
191 Consultations

4.9 on 5.0

Dear Sir,

The following information may kindly be read:

As per RBI rules regarding repatriation of sale proceeds of immovable property in India by PIOs, Authorized Dealers [such as banks] can allow repatriation of sale proceeds abroad provided:oProperty sold was not agricultural land, farm house or plantationoProperty was legally acquired as per rules prevalent under the foreign exchange regulations at the time of acquisition.oRepatriation amount does not exceed the amount paid for acquisition of the immovable property in foreign exchange received through normal banking channels, or from foreign currency accounts in India such as NRE account.oWhile the foreign exchange portion used to purchase property in India is easily repatriated. Any additional amount that does not fall in this category can be repatriated under the provision where NRIs and Persons of Indian Origin are allowed to remit an amount, not exceeding US $ 1,000,000 (US Dollar One million) per financial year out of the balances held in NRO accounts. Sale proceeds need to be deposited in a NRO account in such cases and repatriation is allowed subject to providing proof that any applicable taxes due have been paid. You can use the services of a Chartered Accountant to help complete the formalities

Netravathi Kalaskar
Advocate, Bengaluru
4952 Answers
27 Consultations

4.8 on 5.0

Hello,

Yes tax declaration will be required in both the countries, since in the sale deed the mode of transfer of consideration is to be shown.

Regards

Anilesh Tewari
Advocate, New Delhi
17940 Answers
377 Consultations

5.0 on 5.0

If property is in India then tax implications will arise in India and not in the country where the OCI resides

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

Sir we have gone through your question and advised you accordingly only that the proceeds can be received through NRO account in India and same can be remitted abroad as the transfer is taking place in India.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

Your major question is on proceeds which cannot be received out of India for tax purposes any tax withholding the sale of property amount should be received in Indian Bank account to reflect the actual sales budget and withheld Tax amount will be deposited in the Income Tax Department I hope now your queries answered

Vimlesh Prasad Mishra
Advocate, Lucknow
6848 Answers
23 Consultations

4.9 on 5.0

If TDS is being withheld in NRE account

And the outward remittance is lesser than the yearly repatriable limit,

Then balance after TDS, subject to above limit, can be sent abroad, after currency conversion to the currency of destination

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

Your query did not mention that property was residential or not

2) you may transfer residential or commercial property in India by way of gift to a person resident in India or to a person resident outside India and is a citizen of India or to an OCI card holder resident outside India

3)Sale proceeds need to be deposited in a NRO account in such cases and repatriation is allowed subject to providing proof that any applicable taxes due have been paid.

Ajay Sethi
Advocate, Mumbai
87976 Answers
6207 Consultations

5.0 on 5.0

For the purpose of calculation of the tax, the sale proceed have to be reflected in the Indian Account otherwise you may mention that same sale consideration which you have received in the Indian bank account.

Regards

Anilesh Tewari
Advocate, New Delhi
17940 Answers
377 Consultations

5.0 on 5.0

- if OCI sells property to another OCI can the proceeds be received directly abroad ? tax declaration would be required in both countries.

a foreign national who is a ‘person resident i n India’ within the meaning of Section 2(v) of FEMA, 1999 can purchase immovable property in India, but the person concerned would have to obtain the approvals and fulfil the requirements, if any, prescribed by other authorities, such as, the State Government concerned, etc. The onus to prove his/her residential status is on the individual as per the extant FEMA provisions, if required by any authority.

T Kalaiselvan
Advocate, Vellore
78133 Answers
1543 Consultations

5.0 on 5.0

After the sale of property, the NRI may repatriate the sale proceeds of residential or commercial property in India but must remember that the repatriation of sales is restricted to two properties only. Also, the repatriated amount should ideally not cross the sum paid for acquiring the property, either in foreign exchange received from banks or the Non Resident account, nor should it overshoot the foreign currency equivalent as on the day of payment. Today, remittance of funds from property sales is simple and hassle-free for the benefit of NRIs.

T Kalaiselvan
Advocate, Vellore
78133 Answers
1543 Consultations

5.0 on 5.0

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