Property Taxation for NRIs for United Kingdom NRIs
Complete 2025 guide for United Kingdom-based NRIs investing in Indian real estate.Tax implications on property investment and rental income
United Kingdom NRI Quick Facts
UK-based NRIs can purchase property in India with same rights as resident Indians. Must have NRE/NRO account.
Capital Gains Tax for United Kingdom NRIs
When selling property in India, United Kingdom NRIs are subject to capital gains tax. Long-term gains (property held >2 years) are taxed at 20% with indexation. Short-term gains are added to income and taxed at applicable slab rates.
TDS (Tax Deducted at Source)
Buyers must deduct TDS when purchasing property from NRIs. TDS rate is 20% for long-term gains and 30% for short-term gains. TDS certificate must be provided to the NRI seller.
DTAA with United Kingdom
India has a Double Taxation Avoidance Agreement (DTAA) with United Kingdom. This allows you to claim tax credits in United Kingdom for taxes paid in India, preventing double taxation on the same income.
Rental Income Taxation
Rental income is taxable in India at 30% flat rate for NRIs. Standard deduction of 30% is allowed for maintenance. TDS at 30% is applicable on rental payments to NRIs.
Required Documents
- PAN card
- Tax residency certificate from United Kingdom
- Form 15CA/15CB for repatriation
- Computation of capital gains
- Property purchase documents
- Bank statements showing transactions
Important Notice
Laws and regulations may change. Always consult with a qualified legal professional before making investment decisions. EstateKart provides general guidance only.
Frequently Asked Questions
Will I be taxed twice - in India and United Kingdom?
The DTAA between India and United Kingdom prevents double taxation. You can claim foreign tax credit in United Kingdom for taxes paid in India.
What is the TDS rate on property sale?
TDS is 20% for long-term capital gains (property held >2 years) and 30% for short-term gains.
Can I reduce my tax liability?
Yes, through indexation benefits, reinvestment in new property (Section 54), or capital gains bonds (Section 54EC).
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