Tax and TDS on Property Sales

Non-Resident Indians (NRIs) have a good investment portfolio in India. Often, to repatriate funds abroad or reinvest in an alternate property, they decide to sell their immovable property (inherited or self-acquired) in India.

NRIs are free to sell their assets, but any sale of assets attracts Capital gain taxes! The buyer of such properties are obliged to deduct taxes (popularly known as ‘withholding tax’ or ‘TDS’)

So what, let them deduct the taxes and pay to the Government. But the catch is the TDS rate! If the property is worth Rs.2 Crore, the TDS to be done is Rs.47.38 lakhs (TDS @ 23.69%). Too much isn’t it?