Buying a Mumbai flat from abroad:
FEMA, POA, repatriation and the tax timeline

Buying a Mumbai flat from abroad is routine, but it fails at predictable points. The money has to arrive the right way, a document signed in another country has to be accepted by a sub-registrar in Mumbai, and the tax on an eventual sale is deducted in a way that surprises almost every seller. This guide takes an NRI buying property in Mumbai through each of those points in order.

It is written to be read at two in the morning in a different time zone, so every section stands on its own and opens with the answer. Rates and section numbers are as of September 2026. The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026 and renumbered the familiar TDS sections, so older guides quote numbers that no longer apply. None of this replaces a chartered accountant who can see your whole position.

What the rules allow an NRI buying property in Mumbai

Short answer: almost anything except farmland.

Indian citizens living abroad and OCI cardholders can buy residential and commercial property in India without Reserve Bank permission, with no limit on number. The FEMA rules for NRI property purchase exclude agricultural land, plantation property and farmhouses, which need specific approval.

For an NRI buying property in Mumbai, whether the flat is under construction in one of the new projects in Worli or a resale among the older 3 BHK flats in Matunga, the rules on who may buy are the same. The differences are in how you pay, who signs for you, and how the tax falls when you sell.

The FEMA rules for NRI property purchase, and how the money moves

Short answer: through the banking system, from an NRE, FCNR(B) or NRO account, or as a fresh remittance from abroad.

The Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 set out the FEMA rules for NRI property purchase. Cash is not permitted, and neither are traveller's cheques or foreign currency notes. Every payment an NRI buying property in Mumbai makes, from the booking amount to the last instalment, should leave a bank trail that leads back to them.

The NRE NRO account for property purchase decision matters years later rather than today. Money paid from an NRE or FCNR(B) account, or remitted fresh from abroad, counts as foreign exchange. Money paid from an NRO account, which usually holds rupee income earned in India, does not. That decides how much of an eventual sale can go back abroad. If you have the choice, pay from NRE.

The power of attorney, where most deals stall

Short answer: draft the power of attorney for NRI property purchase India will register narrowly, execute it properly abroad, and have it stamped in Maharashtra within three months of it arriving in India.

Almost every NRI buying property in Mumbai needs someone in the city to sign and register the agreement for sale, take possession and deal with the bank. That person acts under a power of attorney for NRI property purchase India's sub-registrars will accept, and getting that acceptance is where deals most often stall.

The steps, in order:

1. Draft a specific power of attorney that names the flat, the project and each act the attorney may perform. A general power "to deal with my property" is often refused.
2. Sign it before a notary where you live, then have it apostilled if that country belongs to the Hague Apostille Convention, or attested at the Indian embassy or consulate if it does not.
3. Send the original to Mumbai. Within three months of its arrival in India it must be adjudicated and stamped under Maharashtra stamp law.
4. Only then can your attorney use it at the sub-registrar's office, where they appear in person with their own identity documents.

Deals stall for small reasons: a name spelt one way on the passport and another on the PAN card, a missed three month window, or a power that says nothing about home loan documents on the day the bank needs them signed.

An NRI home loan, briefly

Short answer: available on broadly the same terms as a resident's, with repayments from abroad or from the same NRE NRO account for property purchase payments.

An NRI home loan India's larger banks and housing finance companies offer follows the same Reserve Bank loan-to-value caps as a resident's, which means up to 75 per cent of the property value for loans above ₹75 lakh. Lenders will ask an NRI buying property in Mumbai for income proof from the country of residence and, often, a contact or co-applicant in India. Repayments made from NRE or FCNR(B) funds can count towards the foreign exchange you are later allowed to send back, so keep every statement.

TDS on property purchase from NRI sellers, and the resale trap

Short answer: when you buy from a resident developer you deduct 1 per cent. TDS on property purchase from NRI sellers, which is what your own buyer faces when you sell, is charged on the whole price, not on your gain.

On the way in, the buyer of any flat worth ₹50 lakh or more deducts TDS at 1 per cent from each payment to a resident seller and deposits it with the tax department. Under the new Act that sits in section 393(1), which replaced the old section 194-IA.

For an NRI buying property in Mumbai today and selling it in ten years, the exit matters as much as the entry, and on the way out the rules change sharply. TDS on property purchase from NRI sellers falls under section 393(2), which replaced section 195. There is no ₹50 lakh threshold, and the buyer needs a TAN. The buyer deducts tax on the entire sale price: 12.5 per cent plus surcharge and cess if the flat was held for more than 24 months, and slab rates plus surcharge and cess if it was held for less.

Here is what TDS on property purchase from NRI sellers does to a real sale. On a ₹4 crore sale of a flat bought for ₹3 crore, say one of the 3 BHK flats in Matunga, roughly ₹60 lakh can be deducted, when the tax on the actual ₹1 crore gain is closer to ₹15 lakh. The difference waits with the tax department until you file a return and receive a refund, which can take a year or longer.

The fix is a lower deduction certificate, applied for before you sign the sale agreement, so that the buyer deducts only on the estimated gain. It is the one lawful way to reduce TDS on property purchase from NRI sellers at source. It takes weeks, not days, so start the application when you start looking for a buyer.

Repatriation of sale proceeds, and the limits nobody mentions

Short answer: for up to two residential properties, what you originally paid in foreign exchange can go back abroad, and anything beyond that is capped at USD 1 million a year through your NRO account.

The FEMA rules for NRI property purchase also decide what can leave India later. The rules on repatriation of sale proceeds NRI property owners actually face have two ceilings. For up to two residential properties, you can send abroad the sale proceeds up to the amount you originally paid in foreign exchange, which means inward remittances and NRE or FCNR(B) funds.

Anything beyond that, including the gain and anything originally paid from an NRO account, lands in your NRO account. From there it can be remitted under a separate facility capped at USD 1 million per financial year across all your NRO balances, with a chartered accountant's certificate and the prescribed remittance forms.

For most single-flat sellers the two routes together are enough. For a family selling a large flat in one of the new projects in Worli, bought largely from NRO funds, the repatriation of sale proceeds NRI property rules allow can stretch across two or three financial years, and that is the limit nobody mentions until the money needs to move.

The tax timeline, from booking to sale

The full sequence for an NRI buying property in Mumbai, in order:

1. Before booking: a PAN, an NRE account, the documents required for NRI to buy property in India, and an NRI home loan India sanction letter if you need one. Check the project's MahaRERA registration as well; the guide to RERA, OC and CC shows how.
2. At booking and each instalment: pay from the right NRE NRO account for property purchase, ideally NRE, or by remittance, as the FEMA rules for NRI property purchase require, and deduct 1 per cent TDS where the price is ₹50 lakh or more.
3. At the agreement: pay stamp duty and registration. In Mumbai stamp duty is 6 per cent including metro cess, with a 1 per cent concession for women buyers subject to conditions, and registration is 1 per cent capped at ₹30,000.
4. While you own it: if the flat is let, your tenant must deduct TDS on the rent paid to you as a non-resident, and you file a return in India.
5. Before selling: apply for the lower deduction certificate.
6. After selling: file the return, claim any refund, and complete the repatriation of sale proceeds NRI property owners are allowed, with the chartered accountant's certificate.

The price you agree in step 2 should be a carpet area price you have checked; the piece on carpet, built-up and super built-up walks through the arithmetic.

The documents required for NRI to buy property in India

Every NRI buying property in Mumbai should keep scanned copies of the documents required for NRI to buy property in India in one folder before booking.

1. Passport with visa or residence permit, or an OCI card.
2. PAN card.
3. Overseas address proof, and Indian address proof if you have one.
4. Bank statements from India and from abroad.
5. Proof of income from your country of residence, for any loan.
6. The stamped and registered power of attorney for NRI property purchase India requires, if a representative is signing for you.
7. Passport-size photographs.

The next Buyer Education piece works through the EMI arithmetic on a ₹2 crore Mumbai home at 2026 rates.