If you are buying a house from an NRI, then keep this in mind, otherwise you will incur a loss of lakhs
House Buying Tips: If you are also buying a house from such an NRI, then you have to keep some things in mind. Otherwise, you may incur a loss of lakhs and crores.
House Buying Tips: If someone has his own house in a city, then it has a different meaning. Buying a house is everyone's dream right from the beginning. People work very hard for this. They collect a lot of savings. Then with great difficulty, they are able to save enough money to buy a house. People pay attention to many things while buying a house. Like where is the place, and the structure of the house.
What is its price? Some Indian people have settled outside India. Such people also want to sell property in India. If you are also buying a house from such an NRI, then you have to keep some things in mind. Because a house is not bought every day. A small mistake in this can cause you a loss of lakhs and crores.
If you buy a house from an NRI, keep these things in mind
While buying property, you have to follow Indian laws. If you buy property from an Indian citizen, then there are different rules for it. On the other hand, if you buy from an Indian who has settled abroad, that is, who is a Non-Resident Indian, then you have to follow some rules of the Income Tax Act of India. Under that, you have to complete the process. In the case of buying property from an NRI, the paperwork and other processes are a bit difficult.
Understand the rules regarding tax
The taxation process while buying property from an NRI is different from the normal one. Under Section 195 of the Income Tax Act, if you want to buy property from an Indian, then you have to pay one percent tax. On the other hand, if you want to buy immovable property from an NRI, then you have to pay 20% tax as compared to that. If property up to Rs 50 lakh is bought from an Indian, then no tax has to be paid.
But if a property worth less than 50 lakhs is purchased from an NRI, then 20.80 percent TDS has to be paid, for property between 50 lakhs and 1 crore, 22.58 percent TDS has to be paid. Whereas, 23.92 percent TDS has to be paid on property worth one crore. If the NRI does not pay the tax, then the department recovers the previous tax dues from the new owner of the property at an interest rate of 12%.
It is necessary to get a TAN
When you have to buy a property from an NRI, then under section 195 of Income Tax, it is necessary to have a TAN (Tax Deduction and Collection Account Number) for TDS deduction. If you do a property deal and TDS is deducted without TAN, then a heavy penalty can be imposed on you by the Income Tax. If someone else is also a partner in the property with you, then he must have a TAN as well.
Ask the owner to stay in India till the property deal is done
Till the time your property deal with the NRI is completed and its registration is done, ask the NRI owner of the property to stay in India so that he can be present in front of the registrar. But if he is not present in the registrar's office during the deal, then you should find out to whom he has given the power of attorney to finalize the property deal.
Do not make full payment to a single owner
When you are buying property from an NRI, you should find out how many owners the property has. Because later if any dispute arises regarding the property, then you may face difficulty. That is why find out all the owners and give an equal share of payment to everyone. Keep its details with you. Paying full payment to only one owner may lead to legal troubles in the future.
