NRIs guide to repatriating your funds from property sale to foreign country

April 13, 2025

Selling Your Indian Property? Here's How to Bring the Money Home to the US

So you've decided to sell your property back in India and are ready for the next chapter, perhaps with some sunny days in the USA! That's exciting, but navigating the financial side of things can feel a bit like deciphering an ancient code. Don't worry, I'm here to break down the process of repatriating your sale proceeds from India to the US in a way that's easy to understand – with real-life examples!

First Things First: You Got This! Before you get started, make sure you meet these basic requirements:

  • Official NRI Status: You're officially recognized as a Non-Resident Indian.
  • Repatriation Limit: Every year, NRIs can bring back up to US$1 million from India. This includes any capital gains you make from selling your property, and it applies even if you bought the property using foreign exchange or funds held in a special type of Indian bank account (FCNR).

Example: Let's say you inherited a flat in Mumbai from your grandmother and decide to sell it after 5 years. You made a profit of US$800,000 on the sale. This amount can be repatriated to the US without any additional restrictions, as long as it falls within your annual limit.

Taxes: It's All About Transparency Remember, Uncle Sam loves transparency!

  • Long-Term Gains: If you owned the property for more than three years, you'll owe long-term capital gains tax at a rate of 20% on the profit. This is calculated by subtracting the original cost (adjusted for inflation) from the selling price.
  • Reporting Everything: Even if you haven't physically brought the money to the US yet, you need to declare all foreign income, including your property sale proceeds, on your US tax returns.

Example: You sold your Delhi house for INR 1 crore (approx. US$120,000) after owning it for 6 years. After adjusting for inflation and deducting expenses, your profit is INR 50 lakhs (approx. US$60,000). You'll need to pay a 20% capital gains tax on this profit in India and report the entire sale transaction on your US tax return.

The Paperwork Shuffle: It's More Than Just a Sale Here's where things get a little detailed, but don't panic!

  1. Sale Deed: Get a certified copy of the official document that proves you sold the property.
  2. CA Certificate (Form 15CB): Find a reputable Chartered Accountant (CA) in India to help you with this. They'll issue Form 15CB, confirming:
    • You earned the money legally through the sale.
    • All taxes have been paid.
  3. Online Tax Filing (Form 15CA): Head over to the Indian income tax department website and fill out Form 15CA online. Make sure you double-check everything, print a copy with your signature, and keep it safe!

The Bank Connection: Your Gateway to the US Now it's time to involve your bank – the one that handles your Non-Resident Ordinary (NRO) account in India.

  1. Schedule a Meeting: Book an appointment with their Foreign Exchange department.
  2. Gather Your Documents: Be ready with all your paperwork, including:
    • Sale Deed copy
    • Passport or PAN Card (identity proof)
    • Address Proof
    • Form A2 (Application for Repatriation of Funds)
    • Foreign Exchange Application Form

Extra Steps If You Inherited the Property: If you didn't buy the property, you'll need to provide:

  • Copy of the Will
  • Death Certificate of the Original Owner
  • Legal Heir Certificate

The Final Touchdown: Funds Transfer Success! Your bank will review everything, and if all is in order, they'll initiate the transfer to your US account. You'll get confirmation from both banks once it's done.

Remember: Seek advice from a tax professional or financial advisor for personalized guidance. Always follow the rules! Good luck with your move – it's going to be amazing!

Need help navigating the process? Taxero can help you go through this process with the help of its tax experts, such as Chartered Accountants. Schedule an appointment here.



Note: Above details are meant for generalized situations and shall not be used as a legal basis for any particular situation readers may have. We do provide tax consultations for specific scenarios and can be reached through our contact us form.



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