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Indian citizens who stay abroad for employment or carrying on business or vocation outside India or for any other purpose in circumstances indicating an indefinite period of stay abroad; OR
Government servants who are posted abroad on duty with the Indian missions and similar other agencies set up abroad by the Government of India where the officials draw their salaries out of Government resources; OR
Officials of the State Government and Public Sector Undertakings deputed abroad on temporary assignments or posted to their branches or offices abroad.
Who is a foreign citizen of Indian Origin?
In what manner the purchase consideration for the immovable property should be paid under the general permission?
The purchase consideration should be met either out of inward remittances in foreign exchange through normal banking channels or out of funds from any non resident accounts maintained with banks in India.
Is there any restriction on the number of residential properties that may be purchased by an NRI?
There are no restrictions on the number of residential properties that may be bought by an NRI. However, repatriation is allowed only in respect of two such properties.
Can Such Propery Be Sold Without The Permission Of Reserve Bank?
Yes. Reserve Bank has granted general permission for sale of such property. However, where another foreign citizen of Indian origin purchases the property, funds towards the purchase consideration should either be remitted to India or paid out of balances in non-resident accounts maintained with banks in India.
Can Sale Proceeds Of Such Property If And When Sold Be Remitted Out Of India?
In the event of sale of immovable property other than agricultural land/farm house/plantation property in India by a NRI or PIO, the authorized dealer may allow repatriation of the sale proceeds outside India, provided all the following conditions are satisfied: -
NRIs/PIOs can effect remittance of sale proceeds of immovable property in India irrespective of the period for which the property was held. The sale proceeds allowed to be repatriated should, however, not exceed the foreign exchange brought in to acquire the said property.
In case of residential property, the repatriation of sale proceeds is restricted to not more than two such properties, if the property was purchased from funds held in NRE Account.
The amount sought to be repatriated abroad should not exceed the amount paid for acquisition of the immovable property in the foreign exchange received through normal banking channels or out of funds held in FCNR or NRE Account. In case of investment out of NRE Account the amount to be calculated as foreign currency is equivalent value as on the date of payment for acquisition of the said property.
Can NRI's/PIO's Rent Out The Properties (Residential/Commercial) If Not Required For Immediate Use?
Yes. NRI/PIOs can freely rent out their immovable property, whether purchase through application of forex or otherwise, without seeking any permission from the RBI. The rental income being a current account transaction is repatriable outside India, only if proper tax is paid or provided for.
Does RBI Have Any Guidelines For Loans To NRI's/PIO's?
Yes. There are guidelines issued by the by the Reserve Bank of India for grant of Housing Loans to NRIs. The guidelines are:
The loan amount shall not exceed 85% of the cost of the dwelling unit.
Own contribution, which is the cost of dwelling unit financed less the loan amount, can be met from direct remittances from abroad only through normal banking channels, your Non-Resident (External) [NR (E)] Account and /or Non-Resident (Ordinary) [NR (O)] account and /or Non-Resident Special Rupee account [NRSR] in India.
Repayment of the loan, comprising of the principal and interest including all the charges are to be remitted from abroad only through normal banking channels, your Non-Resident (External) [NR (E)] Account and /or Non-Resident (Ordinary) [NR (O)] account and /or Non-Resident Special Rupee account [NRSR] in India
Can Authorised Dealer Grant Loans To NRIs For Acquisition Of A Flat/House For Residential Purposes?
Authorised dealers have been granted permission to grant loans to NRI's for acquisition of house/flat for self-occupation on their return to India subject to certain conditions Repayment of the loan should be made within a period not exceeding 15 years out of inward remittance through banking channels or out of funds held in the investors' NRE/FCNR/NRO accounts.
Can Authorized Dealer Grant Housing Loan To NRI's Where He Is A Principal Borrower With His Resident Close Relative As A Co-Applicant / Guarantor Or Where The Land Is Owned Jointly By Such NRI Borrower With His Resident Close Relative?
Yes. Such housing loans availed in rupees can also be repaid by the close relatives in India of the borrower.
What Are The Documents I Have To Submit Along With The Application?
The following documents are normally to be submitted along with the application:
Photocopy of the labour contract and English translation duly countersigned by your employer
Photocopy of labour card/identity card
Photocopy of valid resident visa stamped on the passport
Photocopy of monthly statement of local bank account for the last 4 months
Declaration by Non Resident of India/ Person of Indian Origin/ Overseas Citizen of India
Can An NRI Take Loan Against The Security Of Immovable Property In India? Are There Any Restrictions On The Use Of Loan Amount?
An NRI can borrow against the security of immovable property from Authorised Dealer subject to following conditions:
The loan should be used for meeting the personal requirements or for borrower's own business purposes.
The loan amount cannot be remitted outside India,
Repayment of loan shall be made from out of remittances from abroad or by debit to NRE/FCNR/NRO account or out of the sale proceeds of shares or securities or immovable property against which such loan was granted.
Can An NRI Take Loan Against The Security Of Immovable Property In India? Are There Any Restrictions On The Use Of Loan Amount?
Yes, TDS is deductible on behalf of the developer from the amount paid by NRI. It has now been made mandatory for resident indians, NRI and PIO.
Note: A PAN card copy is required for this.
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