Community Experience

Shared by Manoj Yadav

Originally shared in the Indian Expats in USA Facebook community on January 15, 2024. Republished here with the original author’s permission.

Below, Manoj shares his firsthand experience of how to transfer money from India to US after selling property, including the steps, documentation and banking process he went through.

Original Community Post

Hi,

Wanted to share the process of transferring funds from India after the sale of a property. To give a little background, I am selling all my Indian properties and transferring funds to the US for a couple of reasons;

1) all works well until you get into a legal fight. One of my properties I had given to my relative for general upkeep, they gave it on rent without my knowledge for the last couple of years. When I got to know from another relative, they simply changed their cell numbers. With a forged rent agreement and rampant bribery in local establishments, it’s an uphill task in Indian courts to get an eviction order.

2) My US investments in real estate have far exceeded overall returns compared to India ones.

Now back to the process, here is what happens:

1. Hired an agent. I paid 2% of the property value to the agent who marketed the property, showed it to the prospective buyers, and negotiated a deal, and handled paperwork. They required my US passport copy, address proof, and OCI card for paperwork.

2. When paperwork is being prepared, let the agent and buyer know that you are an NRI so they need to deduct about 20% for long-term capital gains from the sale amount and deposit it with Income Tax as TDS.

3. Sign an agreement of sale and then execute the sale deed (I did it through power of attorney to my agent).

4. The seller can send sales proceedings to your NRO account through RTGS or NEFT or cheque.

5. You then need to transfer it to the NRE account before transferring it to the US.

6. Transfer requires a form called 15CA/B which is filed for and obtained by a Chartered Accountant. I consulted two CAs for it; one from Delhi and one from Mumbai. The Mumbai one wanted 40k INR for the whole thing and the Delhi one only asked for 20k so I went with Delhi one. Both are good professionals but Delhi one I felt was a bit better in communications.

7. The CA would ask for the date of purchase, buyer agreement, sale agreement, date, and details of all payments made in the past. Based on the data, they calculate your tax liability on the property. Mine was 12 years old so based on indexation of property value, I did not have to pay much.

8. Obtaining Income Tax approval is a multiple-step process: 1) RA authority review 2) email verification 3) video KYC 4) document review 5) Esign (it’s mandatory for NRIs) 6) EKYC account 7) Download remittance certificate. CA manages this process.

9. You need to specify the exact amount you intend to take out of the country for this transaction. Form 15A will have that amount and the bank will only process that amount.

10. Once CA gives you a PDF of the form 15CA, you take it to your bank who will prepare for a wire transfer using SWIFT.

11. I received the money in two days from HDFC.

12. The next step in India is to file taxes and get the TDS back.

13. US FBAR and tax filing is a cinch.

I loved how professionally my CA handled it and gave me sane advice. For example, I initially thought I would keep some amount in India and some in the US but he straightaway said, sir sab le jao yahan kay regulations or currency depreciation se aap ko kuch fayada nahi hone wala long run mai. He told me stories of 2 of his NRI acquaintances in Gurgaon whose properties were sold without their knowledge using forged identities and papers. In the end, he said thank God you at least could sell it and transfer money.

Hope this helps.

For anyone looking to transfer money from India to US after selling property, Manoj’s experience highlights the importance of understanding the tax documentation and bank requirements before initiating the transfer.

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