Criminal Trident Pack: IPC, CrPC and IEA by Sr. Adv. G.S Shukla and Adv. Raghav Arora
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Priya   25 June 2022

Tds on nri while selling property flat in india

Can anyone explain section 195 income tax act please. Iam registrating a flat which belongs to NRI for 21 lakhs . As per section 195, even if it is less than 50 lakhs, buyer should taken responsibility in deducting the TDS of 20.8%.My seller feels it's a loss of 4 lakhs. He will get 17 lakhs only. 

What are the ways the seller can exempt this TDS at the time of registration. Experts please guide us. Thank you so much🙏


 1 Replies

Anila Sabu   27 June 2022

Dear Qurist,

If an NRI sells real estate in India, the buyer must withhold TDS at a rate of 20% in cases where long-term capital gains are involved. However, TDS must be deducted at a rate of 30% as a short-term capital gains tax if the property is sold before two years have passed.

Section 195 of the Income Tax Act of 1961 says that:

The deduction of income tax from payments made to non-residents is required.

An undertaking (in form 15CA) and a Chartered Accountants Certificate (in form 15CB) must be provided by the individual sending the money to a non-resident.

In response to your query about reduction of TDS I would advise you to submit Form 13.

This is an application to the Income Tax Department for the issuing of a Certificate for Nil/Lower Deduction of TDS in order to lower the TDS on the sale of property.

The vast majority of NRIs chose this particular certificate as it significantly lowers their TDS Liability.

Majority of NRIs hire a Chartered Accountant to file this application as it is a difficult undertaking, and so you can avail services to make it easier for you.

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