TDS, power of attorney, capital gains and getting the money out — the process for NRIs selling a Mumbai flat, and the mistakes that delay it.
Selling a Mumbai flat from abroad is entirely possible. It just has more moving parts than a sale by a resident, and most delays come from the tax and paperwork side rather than finding a buyer. This is the process, and where it usually goes wrong. Tax rules change — confirm the specifics with a chartered accountant who handles NRI cases before you sell.
The short answer
You can sell without travelling, using a properly drafted power of attorney. The buyer must deduct tax at source (TDS) from what they pay you. Capital gains tax applies, and getting the proceeds abroad depends on how you originally paid for the property. Speak to a CA before you agree a price, not after.
TDS: the part that surprises sellers
When the seller is an NRI, the buyer is required to deduct TDS from the payment and deposit it with the tax department. For an NRI seller this deduction is generally calculated on the sale price, not just your profit, so it can be much larger than the tax you actually owe.
Two things help:
- You can apply to the income tax department for a lower or nil deduction certificate, so the buyer deducts only what is actually due on your gain. It takes time, so apply early.
- Any excess deducted can be claimed back when you file your Indian tax return — but that takes longer.
Make sure the buyer has a TAN and deposits the TDS correctly; you will need the TDS certificate.
Capital gains
The gain is taxed in India. How it is taxed depends mainly on how long you have held the property, your purchase cost and improvement costs. Your CA will also advise on any exemptions available and how the sale interacts with tax in your country of residence.
Power of attorney
You don't need to fly in. A power of attorney lets someone you trust sign and register the sale on your behalf. Keep it specific to this sale, and execute it correctly where you sign it — usually notarisation and, depending on the country, apostille or consular attestation — and complete the formalities in India before it is used.
Getting the money out
Sale proceeds are credited to your NRO account. How much you can send abroad, and under what conditions, depends on how the property was originally bought and is subject to RBI rules and limits; your bank and CA will need the purchase and sale documents and tax certificates. This is why the question "how did you pay for it originally?" matters so much.
Documents to have ready
- Your purchase agreement and the chain of earlier agreements
- Society share certificate and a society NOC for the transfer
- Proof that maintenance dues and property tax are clear
- PAN and passport, and the power of attorney if someone is signing for you
- Loan closure letter, if the flat had a home loan
Common mistakes
- Agreeing a price before understanding the TDS — and being surprised by the net amount.
- A broad, open-ended power of attorney instead of one for this transaction.
- Leaving the lower-deduction certificate too late.
- Missing society paperwork, which holds up the buyer's loan.
Our NRI services team can manage the sale on the ground — valuation, buyers, paperwork and registration — while coordinating with your CA on the tax side. For buying from abroad, see our NRI guide to buying in Mumbai.