Lower TDS certificate on NRI property sales

Why the default withholding is high

When a buyer acquires immovable property from a non-resident, tax is required to be withheld at source. In the absence of a certificate, the buyer often deducts tax on the entire consideration. That can lock a large share of the proceeds until the seller files a return and claims a refund — a process that may take many months while you are overseas.

The certificate route

An application under Section 197 (commonly supported by Form 13 / the current e-filing equivalent) asks the Assessing Officer to authorise a lower or nil rate based on estimated capital gains after cost, indexation and eligible exemptions. Once issued, the buyer deducts tax only as the certificate directs.

• Review of the agreement and cost of acquisition (including inherited property)
• Working of estimated gains and proposed withholding
• Electronic filing and follow-up with the Assessing Officer
• Guidance to the buyer on depositing TDS against the certificate

Timing

With a complete file, many certificates are issued in two to four weeks, though processing varies by jurisdiction. Applications should start before the registration date whenever possible.