No, I’m not an NRI. India is a great place to retire. Do you want to own a beautiful farmhouse that is a little outside of the city, with a great lawn for your kids to play on and a chair where you can enjoy your morning tea while reading the paper? Tempting! Isn’t it?
But can an NRI buy land for farming in India? Can you plan to retire in a farmhouse or on agricultural land or a plantation? Can you buy land for farming in India? We’ll find out.
NRIs can buy agricultural land: Let’s look at the rules first: NRIs and OCIs aren’t allowed to buy any agricultural land or plantation property or farmhouses in India by law unless they get permission from the Reserve Bank of India (RBI).
As for NRIs and OCIs can’t buy farmland, plantation property, or a home in India on their own. They can, however, inherit it from a resident Indian who owns it. An NRI can even inherit such properties from other NRIs, but only if they meet specific rules, like getting permission from the RBI, to do so.
People who live outside India can give gifts to people inside India, but people who live inside India can’t give gifts to other people outside India. An NRI can only give gifts to an Indian resident. Simple words:
NRIs and OCIs can only sell agricultural land, plantation property, or a farmhouse to Indians who live in the same country as the land. For the land bought with permission from the RBI, special permissions are needed to complete the sale.
The money from the property sale must go into the NRO account NRI. If you have an NRO account, the maximum amount that can be sent from it is US$ 1 million. Outward remittances with forms 15CA and 15CB go through the same process when they are sent back home. People also need to have a will, the death certificate of the person who died, and the agreement to sell their home (in case of sale)
People who live outside the country pay taxes on the sale of agricultural land in different ways in rural and urban areas: Rural agricultural land is not a capital asset, so there is no capital gains tax when it is sold. In contrast, when it is sold in an urban area, there is a capital gains tax.
Indian land for NRIs: Benami transactions:
Buying a home is a complicated job in and of itself. An NRI can’t buy a house for someone else unless that person is the person’s spouse, brother, or sister. Under the Benami Act, it’s against the law to buy a house in someone else’s name.
Non-resident Indians and Indians alike might benefit from investing in real estate in India. In addition, the Indian diaspora is the biggest in the world, with more than 20 million NRIs working abroad and their families back home. Indian real estate is attractive to many NRIs because of these features. The Indian government has changed its property buying guidelines to be more welcoming to investors to accommodate this demand.