Invest in India
No matter where you are in the world, Pearl Group simplifies the process of real estate investment and buying for you.
Welcome to India! As an NRI, you may have numerous questions about investing in real estate here. To simplify the property buying process for our expanding NRI clientele, we've compiled a set of questions and their answers specifically tailored for you.
Who is NRI?
According to India’s Foreign Exchange Management Act 1999 (FEMA), a Non-Resident Indian (NRI) is defined as either an Indian citizen or a Foreign National of Indian Origin who is residing outside India for the purposes of employment, conducting business, or pursuing a vocation, indicating an intention to stay outside India indefinitely. Additionally, an individual is classified as an NRI if their stay in India amounts to less than 182 days during the preceding financial year.
Who is a PIO?
A Person of Indian Origin (PIO) refers to a foreign citizen, except for those from Pakistan, Afghanistan, Bangladesh, China, Iran, Bhutan, Sri Lanka, and Nepal, who at any point in time possessed an Indian passport.
OR
Individuals or their parents, grandparents, or great-grandparents who were born and have been permanently resident in India, as defined in the Government of India Act, 1935, or the Citizenship Act, 1955.
Who can Buy Immovable property in India?
The Foreign Exchange Management Act, 1999 (FEMA) and the Regulations notified by the Reserve Bank of India (RBI), regulates the acquisition or transfer of immovable property in India by Persons resident outside India.
They can acquire a residential property in India by a way of gift from an Indian or purchase it. He or she can even acquire residential property by way of inheritance from a person who is a resident of India as per the Provisions of Section 6(5) of the FEMA, 1999. The general permission, however, covers only purchase of residential and commercial property and not for purchase of agricultural land / plantation property / farmhouse in India.
Can NRI’s obtain a loan to buy a flat/house for residential purpose from authorised financial institutions providing housing finance?
- The Reserve Bank has granted some general permission to certain financial institutions providing housing finance e.g. HDFC, LIC Housing Finance Ltd., etc, and authorized dealers to grant housing loans to NRI nationals for acquisition of a NRI house/flat for self-occupation subject to certain conditions.
- The quantum of loans, margin money and the period of repayment shall be at par with those applicable to housing finance provided to a person residing in India.
- The loan amount is not entitled to be credited to Non-Resident External (NRE)/Foreign Currency Non-Resident (FCNR)/Non-Resident non-Repatriable (NRNR) account of the borrower.
- The loan needs to be fully secured by an equitable mortgage by deposit of title deal on the property proposed to be purchased, and if necessary, also be lien on the borrower’s other assets in India.
- The installment of loan, interest and other charges, if any, shall be paid by the borrower by remittances from outside India through normal banking channels or out of funds in his Non-Resident External (NRE)/Foreign Currency Non-Resident (FCNR)/Non-Resident Non-Repatriable (NRNR)/Non-Resident Ordinary (NRO)/Non-Resident Special Rupee (NRSR) account in India, or out of rental income derived from renting out the property acquired by utilization of the loan or by any relative of the borrower in India by crediting the borrower’s loan account through the bank account of such relative
- The rate of interest on the loan shall conform to the directives issued by the Reserve Bank of India or, by the National Housing Bank (subject to the case).
Income Tax
Do NRI/OCI/PIO need to file tax returns?
Yes, a NRI/OCI/PIO need to file tax returns if they fulfill the below conditions:
- If taxable income in India during the year was above the basic exemption limit of INR.1.6 lakh OR
- If short-term or long-term capital gains were earned from sale of any investments or assets, even if the gains are less than the basic exemption limit.
Please Note: The enlarged exemption limit for senior citizens and women is applicable only to Residents and not to Non-Residents.
Are there any exemptions?
There are two exemptions:
- If the taxable income consisted only of investment income (interest) and/or capital gains income and if tax has been deducted at source from such income, you don’t need to file a tax return.
- If you have earned long term capital gains from the sale of equity shares or equity mutual funds, you need not to pay any tax and therefore it is not required to include that in your tax return.
How can a NRI/OCI/PIO file tax returns?
- You can file your tax return by either granting a power of attorney to someone in India or by sending your form and documents to a tax expert or a chartered accountant in India, who will then file the return on your behalf.
- You can also file your Indian tax returns using the online platform.
What is Power of attorney?
A Power of Attorney is a legal document that grants authority to one person to act on behalf of another. The individual granting the power, known as the principal, appoints an agent to make decisions and take actions on their behalf. The extent of the agent’s powers can be limited or unlimited, as specified in the contract between the principal and the agent.
Pearl Group: Benefits for NRIs
Investing in immovable property with Pearl Group offers numerous advantages for NRIs, including:
- Top-Tier Luxury Accommodations: Access to premium flats and villas at competitive prices.
- Comprehensive Assistance: Support with renting or reselling the property.
- Investment Counseling: Expert advice to maximize your returns.
- Transparent Documentation: All AutoCAD drawings and legal documents provided at the time of transaction.
- Personalized Support: A dedicated customer relations personnel assigned to you.
- Convenience for Visits: Transport facilities available for visiting clients.
- Project Updates: Regular email updates on ongoing projects, if requested.
- Home Loan Support: Assistance with securing home loans from leading banks.
- Legal Assistance: Help with legal documentation and power of attorney, if required.
- Validation References: Available references for cross-checking validation.
Whether you’re surfing in Australia, trekking in South America, skiing in Russia, or enjoying a desert safari in Africa, you can reach out to us with your queries via email, message, or call, and we will resolve them as quickly as possible.
Legal Information
For a Non-Resident Indian, navigating the legalities of purchasing a new home can be complex. To simplify the process, we’ve compiled the essential legal considerations for buying property in India. Additionally, feel free to reach out to us with any specific questions.
No RBI Permission Needed: If a Non-Resident Indian (NRI) holds an Indian passport, they do not need permission from the Reserve Bank of India (RBI) to purchase immovable property for residential purposes.
Payment Methods: NRIs with Indian passports can pay for the property either by remitting funds from abroad through banking channels or through their NRO, NRE, or FCNR account.
Title Report Inspection: NRIs should ensure that the title report of the property does not have any conditions written in fine print and that there are no specific reservations by the State Government.
Clearance Reports: To avoid disputes, it is advisable to obtain specific clearance reports for the property.
Heritage Reservations: If the property is near a heritage building, check for any heritage reservations for the premises.
Coastal Regulation Zone (CRZ) Clearance: For properties near a seafront, ensure there is CRZ clearance.
Home Loan Eligibility: Lack of clear property titles can prevent you from securing home loans.
We are here to assist you with any further inquiries or specific concerns you may have.