TDS when an NRI sells property in India (section 195)
What it means
When a non-resident sells immovable property in India, the buyer must deduct TDS under section 195 on the sale consideration at the rates for long-term or short-term capital gains (plus surcharge and cess), unless the seller obtains a lower-deduction certificate.
What to do
- Compute the capital gain (sale price minus indexed cost and expenses).
- Apply for a lower/nil deduction certificate (Form 13) on TRACES before the sale if the gain is small.
- Ensure the buyer has a TAN and files Form 27Q; collect Form 16A.
- File your return to claim refund of excess TDS; Form 15CA/CB for repatriation.
Deadline: Form 13 should be filed well before the sale deed; TDS is deposited by the buyer by the 7th of the next month.
Documents you will need
- Sale agreement
- Purchase deed and cost proofs
- PAN
- Bank account in India (NRO)
- Form 26AS / AIS
Have this notice? Upload it for a free explanation of your own case. NRI property-sale pack: capital-gains working, Form 13 guide, repatriation steps — $149.
Old section 195: new number [check] under the Income-tax Act 2025; rates unchanged by renumbering. Section numbers refer to the Income-tax Act 1961 / CGST Act 2017; the Income-tax Act 2025 renumbers income-tax sections from 1 April 2026 — the notice shows the applicable number. Checked by the founder on 16 Oct 2026.