Selling Property in Vadodara as an NRI: TDS, Lower-TDS Certificate and Repatriation
When an NRI sells a flat, bungalow or plot in Vadodara, the buyer must deduct tax on the full sale price, not just on your gain, unless you have a lower-TDS certificate. Getting the order right (certificate, sale deed, Forms 146 and 145, repatriation, then your tax return) keeps your money from sitting with the tax department until a refund comes through.
Why it matters
Why NRI Property Sales Need Planning
The tax on your gain is often far less than the tax the buyer deducts. Without planning, the difference stays with the tax department until you file your Indian return and the refund is processed.
TDS is on the full price
On a ₹1.2 crore sale with a ₹30 lakh long-term gain, the buyer may deduct close to ₹18 lakh, while the tax on the gain itself is about ₹4 lakh.
The paperwork runs in sequence
The lower-TDS certificate, the CA's Form 146 and your Form 145 each depend on the step before.
Two countries may tax the gain
Your country of residence may tax it too. The tax treaty and foreign tax credit rules decide how much you finally pay.
Banks check before remitting
Your bank won't send sale proceeds abroad without the tax forms and proof of where the money came from.
How the gain is taxed
How you're taxed depends on your residential status for the year of sale, which is decided mainly by the number of days you spent in India, not by your passport. If you're an NRI for that year:
| Holding period | Type of gain | Tax rate |
|---|---|---|
| More than 24 months | Long-term capital gain | 12.5% without indexation, plus surcharge and 4% cess |
| 24 months or less | Short-term capital gain | Your slab rates (up to 30%), plus surcharge and cess |
For property bought before 23 July 2024, resident individuals and HUFs can choose 20% with indexation instead of 12.5% without it. That choice isn't available to NRIs.
- Jantri value: if the sale price is more than 10% below the stamp duty value (Gujarat's jantri rate), the jantri value is treated as the sale price under Section 50C.
- Inherited property: your cost is the previous owner's cost, or its value on 1 April 2001 if they acquired it before then, and their holding period counts towards yours.
- Exemptions apply to NRIs too: reinvest the gain in one residential house in India under Section 54 (capped at ₹10 crore), or invest up to ₹50 lakh in specified bonds within six months under Section 54EC. For a plot or commercial property, Section 54F covers investment in a house.
- Not reinvested yet? Deposit the amount in the Capital Gains Account Scheme before the return due date to keep the exemption open.
How much TDS will the buyer deduct?
For NRI sellers there's no ₹50 lakh threshold and no flat 1% rate, both of which apply only when the seller is a resident. On a long-term sale, the effective TDS rate depends on the sale value, because surcharge rises with the amount:
| Sale consideration | Effective TDS on a long-term gain |
|---|---|
| Up to ₹50 lakh | 13.00% |
| Above ₹50 lakh and up to ₹1 crore | 14.30% |
| Above ₹1 crore | 14.95% |
12.5% plus surcharge of 10% or 15% and 4% cess, applied to the full sale price unless a lower-TDS certificate is issued. Short-term sales attract TDS at 30% plus surcharge and cess.
A resident individual or HUF buying from an NRI no longer needs a TAN. TDS can be deposited using the buyer's PAN through a challan-cum-statement (Form 141), as with purchases from residents. Companies, LLPs and firms buying from an NRI still need a TAN, and payments made before 1 October follow the TAN-based process with a quarterly Form 144 return (earlier Form 27Q).
Reduce TDS with a lower-deduction certificate
Before the sale, you can apply online through TRACES to the Assessing Officer for a certificate that lets the buyer deduct tax only on your estimated gain, or at a lower rate. This was Form 13 under the old rules. You'll need:
- Purchase deed, allotment letter or inheritance papers, with payment proofs
- Bills for major improvements, with dates
- Draft sale agreement showing the price, the buyer's details and the payment schedule
- Computation of the expected capital gain and any exemption you plan to claim
- Your PAN, passport, overseas address and past Indian tax returns
Apply as early as you can, because processing can take a few weeks. The certificate names the buyer and the amount, so share it with the buyer before the first payment is made.
Step by step: from sale to money abroad
Collect documents and work out the gain
Check your residential status for the year, the property's cost and holding period, and the jantri value.
Apply for a lower-TDS certificate
This is most worthwhile when the gain is small compared with the sale price.
Sign the sale deed at the Sub-Registrar
If you can't travel, a power of attorney signed abroad must be properly attested and then stamped in Gujarat within the time allowed after it arrives in India. Your attorney can then execute the deed.
The buyer deducts and deposits TDS
Ask the buyer for the TDS certificate and check that the credit appears against your PAN in the annual tax statement.
Receive the proceeds in your NRO account
Sale proceeds of property sold by an NRI are credited to an NRO account.
Remit abroad with Forms 146 and 145
Your CA issues Form 146 (earlier 15CB), and you or your bank file Form 145 (earlier 15CA) before the remittance.
File your Indian income-tax return
Report the gain and claim credit for TDS and any refund. For a sale in tax year 2026-27, the return is due by 31 July 2027 if you have no business income.
Sending the money abroad
Under FEMA, NRIs can remit up to USD 1 million each financial year from NRO balances, including property sale proceeds, once applicable taxes are paid. If the property was originally bought with money brought from abroad or from NRE or FCNR accounts, proceeds from up to two residential properties can be repatriated up to the foreign exchange originally paid, under separate RBI rules. Keep proof of that original payment ready, as the bank will ask for it.
From 1 April 2026, Form 145 replaced Form 15CA and Form 146 replaced Form 15CB under the Income-tax Rules, 2026. For a taxable remittance above ₹5 lakh, the CA files Form 146 first, because Part C of Form 145 needs its acknowledgement number.
Common mistakes to avoid
Selling without a certificate
Excess TDS then comes back only as a refund after you file your return, which can take months.
Wrong TDS by the buyer
If the buyer deducts under the wrong section or at the wrong rate, your credit may not appear, and correcting it takes time.
Ignoring the jantri value
A price well below jantri increases your taxable gain under Section 50C, even though you never received that amount.
Not filing an Indian return
Without a return you can't get back excess TDS, and you have nothing to support a foreign tax credit abroad.
Treating joint owners as one
Each co-owner's share is taxed separately, so TDS, certificates and returns follow each person's share.
Using the wrong account
Sale proceeds belong in your NRO account. Mixing them with NRE balances complicates repatriation.
This guide is general information on Indian tax and corporate law as it stood on 11 September 2026, and is not advice for any particular case. Rules, due dates and forms change, and how they apply depends on your facts. Please confirm the current position before acting, or speak to a qualified professional.
Who this is for
Who This Guide Is For
NRI property sales in Vadodara usually fall into one of these four situations.
Family homes in the old city
NRIs and OCIs selling inherited homes in Raopura, Mandvi, Karelibaug or Fatehgunj, often together with several legal heirs.
Investment flats and plots
NRIs who bought in Gotri, Vasna-Bhayli, Sama or along the Sevasi and Bhayli roads and are now selling.
Resident buyers
Buyers purchasing from an NRI who need to deduct and deposit TDS correctly, with or without a TAN.
Returning NRIs
If you're moving back, your status may become resident but not ordinarily resident (RNOR), which changes how gains and foreign income are taxed.
Frequently asked questions
Answers to Your NRI Property Questions
How much TDS will the buyer deduct if I sell my Vadodara flat as an NRI?
For property held over 24 months, 12.5% plus surcharge and cess on the full sale price, which works out to 13%, 14.3% or 14.95% depending on the amount. For property held 24 months or less, TDS is at 30% plus surcharge and cess. A lower-deduction certificate can reduce this.
Does the buyer still need a TAN?
For payments made on or after 1 October 2026, a resident individual or HUF buyer can deposit TDS using their PAN. Companies, LLPs and firms still need a TAN, and payments made before 1 October follow the TAN-based process.
Can I choose 20% tax with indexation?
No. That option, for property bought before 23 July 2024, is available only to resident individuals and HUFs. NRIs pay 12.5% without indexation on long-term gains.
How much of the sale money can I send abroad?
Up to USD 1 million each financial year from NRO balances, after tax, supported by Forms 146 and 145. Separate RBI rules allow proceeds of property bought with foreign exchange to be repatriated up to the amount originally paid.
Do I need to file an income-tax return in India after selling?
Yes. The return reports the gain, claims credit for TDS and gets you any refund. Your country of residence will usually want proof of Indian tax before allowing a foreign tax credit.
I inherited the property. What is my cost of acquisition?
The previous owner's cost, or the property's fair market value on 1 April 2001 if it was acquired before then. The previous owner's holding period is added to yours when deciding whether the gain is long-term.
Selling Property in Vadodara from Abroad? Plan It Before You Sign.
Share the property papers and the expected price by email, and we'll plan the certificate, TDS and remittance with you on a call. Your attorney or buyer can meet us at our Jetalpur office.
C M Patel & Company, Chartered Accountants
204, Pavan Complex, Jetalpur Road, Jetalpur, Vadodara, Gujarat 390007
Phone +91 99740 37318 · Email info.cmpatelandcompany@gmail.com
Monday to Saturday 10:00 am – 8:00 pm · Sunday 12:00 pm – 5:00 pm