NRI’s problems related to property monitoring:
Do you own a property in India?
It’s a walkover if you live in India. You need not spend hundreds of dollars for visiting your own property. Neither would you worry about the encroachers. However, unscrupulous people tend to seize properties. But, if you make occasional rounds, it ensures that your fixed asset would be safe.
Now, see the property monitoring from the lens of an NRI.
Would he be able to make the rounds of his property now and then? Would he be ready to bear on overhead expenses in thousands of dollars once in a month? If he fails to take care of his property religiously, the day won’t be so far when any land-mafia would take over your asset.
Recently, a shocking incident of an NRI’s property has surfaced the Economic Times. It spotlighted the trauma of the one belonging to the Indian diaspora. A non-resident from Zambia purchased a house in the name of his mother. But, his absence for several years gave his siblings an opportunity to acquire that property. His younger brother constructed it without asking the owner. And, he was unable to take any action against.
Property Inheritance:
However, an expat with an Indian passport is not allowed to invest in any immovable property. But, a relative or friend gifts to it, he can take its ownership. Moreover, he doesn’t need to pay tax as a gifted property is exempt from it. The word ‘relative’ (who can gift the property) includes:
- Spouse
- Brother/Sister
- Brother/ Sister of the spouse
- A lineal descendant or ascendant
- A lineal descendant or ascendant of the spouse
But here again, you have to take care of that immovable property by self. Otherwise, the aforesaid problems will take a sneak peek. And, you might lose it.
Benefits of Property in India for non-residents:
- Loan against rental income:
The non-residents can apply for 5-year loan upfront against the rental income. Or, they can deposit the paper of the real-estate as a security with the bank. In return, the bank would provide them short-term funds in India. Apart from banks, the housing companies do play the same role. Therefore, you would have a golden opportunity to get a loan.
- Repatriation up to $1 million:
If you use your property in India for generating rental income, you can repatriate that amount. But, that repatriation would be possible after three-year lock-in period. The lock-in period is the predetermined time.
If it’s generated from an inherited property, you can repatriate up to $1 million in a financial year. There is no lock-in period for this. You don’t need to pay tax. But, you have to provide the documents and certificates attested by the chartered accountant.
Tips to monitor NRI’s property in India:
Are you ready to fight with the encroachers and shady people in India?
Bear in your mind that it’s going to be an uphill battle if you sue from overseas. You can’t visit on every trial. What you can do is to take these steps:
- Ask any relative or friend to take care of that property.
- Engrave a nameplate.
- Go for legal documentation, even if it’s inherited. You must transfer all documents on your name.
- Pay taxes to the Municipal Corporation and other authorities. Pay through cheques.
- Keep photocopies of those cheques and documents in a safe place.
- Don’t empower your attorney with unlimited authority.
- Specify which kind of authority you’ve provided to him. Be it for maintenance and protection of that property, mention it subtly.
- Don’t provide the authority to sell that property. Neither should you provide the power to agree over selling that asset.
Let’s wrap up!
Being an NRI, you should keep an observer’s eye on your property on a daily basis. However, it’s impossible. But, you can do it with the help of your friends and relatives. Make them attorney, but while restricting their power. Keep all documents of that property, cheques of tax and their photocopies in a safe place.
