Laws and Provisions That Makes Investing in Property in India Lucrative for NRIs
Most people believe that investment in the real estate sector is the safest investment option, and as a result, more and more NRIs put their savings in the real estate market of India.
Although buying property in India is quite hassle free, there are certain rules and guidelines that an NRIs have to follow when they are buying or selling a property in India and in order to know about those guiding principles in detail, one can go through the discussion below:
- There is a notification that has been issued by the RBI according to which an NRI is eligible to buy and sell properties in India and in order to do so he/she does not require any special approval.
- An NRI can buy as many commercial and residential properties as he wants in India and no restrictions have been set by the Indian government in regards to buying or selling of Indian properties.
- It is necessary for an NRI to have a PAN, so that, if he generates any income from rental payments, then he can file an income tax return. The PAN is also required at the time of property registration.
- The NRIs can also apply for home loans from Indian banks and these banks also encourage such applications and provide the NRIs with special schemes and offers.
- If an NRI merely acquires a property in India, then he need not pay an income tax. But in case the property generates a rental income, then that income is taxable under the income tax act. Again, in case he sells the property later, then the money that he gains from the sale is very much taxable.
- Though no additional permissions are required by an NRI to own a property in India, but in order to repatriate the sale, an RBI approval is required. This is true in case of all properties that have been purchased. However the rule is different in case of properties that have been inherited.
- In case required, an NRI can also implement a Power of Attorney, set in the name of a close friend or relative, who can take care of all the property related formalities in India on his or her behalf. In case a POA is executed, then it has to be signed by the property owner, in front of a consulate officer or a notary and the signature also needs to be attested by them.
So, when you are planning to buy a property in India, then do keep these points in mind, in order to avoid any difficulties at a later stage. Noida is considered to be a good investment option in India, because of its close proximity to Delhi. So, investing in a residential 2 BHK flat in Noida will definitely be a very good option. Since, you do not stay in India, it is important to do a proper background check of the property developer. If you buy the property of an eminent builder, then, you will be able to get a very good property at quite a good price and you will be safeguarded from any real estate scams at a later stage.