Investment Options in
India:
If you are an NRI planning to buy a property back home in India, read on.
For this will save you a lot of hassles and make the entire process easier.
Even though an NRI is allowed to invest in India, there are certain guidelines
before investing in real estate/property back home.
First, the eligibility. Any person of Indian origin and having an Indian
passport can invest in real estate. Further there is no limit on the number of
property purchased by NRI in India.
NRIs have the option of self-funding the home purchase, or can take a
home loan. RBI has set guidelines for availing of home loans by NRIs, which
say:
• Financial institutions are allowed to finance at most of 80 per cent of
the total amount and the rest has to provided by the NRI
• EMIs or whole re-payment for the purchase of property can be paid
either by way of funds remitted to India through regular banking channels or
through the balance in the NRE, NRO, FCNR account. Cheques issued from the NRIs
local relatives’ bank account are also accepted.
• NRI can also take loans from financial institutions for repair and
renovation of one's home in India.
If an NRI has inherited property in India, one would have to pay tax on
deemed income. Under Section 24 of the income-tax act, the interest paid on the
housing loan is deductible from the income from house property to the extent of
Rs 1.5 lakh per annum, and one can also deduct principle repayment up to Rs 1
lakh under Section 80C. However, this will be applicable only to the income
earned inside India.
It is advisable for NRIs to give a power of attorney (PoA) to a
local/Indian resident, i.e, a person who has been residing in (relative or
friend), as this person can look after all formalities related to purchase of
property, such as registration, possession, execution of agreement deed,
collecting no dues, etc. However, it is important to note that the PoA must be
attested by any authorised official of the Indian embassy/consulate or trade
commissioner in that country.
#nri #investment #property #india #guidelines
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