NRI selling Indian property — slash the TDS and the tax (54-series + Section 197)

The TDS shock

On a sale by an NRI, the buyer deducts TDS on the full consideration — for a long-term holding at the LTCG rate (12.5%) plus surcharge and cess, and at up to 30%+ for short-term. On a ₹1 crore flat that can be ₹13–15 lakh withheld even if your actual gain is small.

Cut the tax itself — the 54-series

• Reinvest in a house (Section 82/86, old 54/54F) — buy/construct a residential house and the gain is exempt.
• Capital-gains bonds (Section 85, old 54EC) — park up to ₹50 lakh of the gain in NHAI/REC bonds within 6 months.

These exemptions are available to NRIs just as to residents.

Cut the cash locked up — Section 197 certificate

Before completing the sale, get a lower/nil-TDS certificate so TDS is computed on your real gain after exemptions, not the gross price. Apply early — it takes a few weeks.

Repatriation

Sale proceeds of up to USD 1 million a year can be repatriated from your NRO account with Form 15CA/CB. Plan the banking alongside the tax.

Who it helps

Any NRI selling a house, flat or land in India — done right, both the TDS and the tax can fall to little or nothing.