Hello ,
As per the provisions of the Indian Income Tax Act, if the seller is an NRI, the buyer is required to deduct TDS (Tax Deducted at Source) at the time of payment of consideration for the sale of property.
You, as the buyer, are required to deduct TDS (Tax Deducted at Source) under Section 195 when purchasing the unregistered 3BHK property from an NRI seller. The TDS rate applicable is 20.8% of the sale consideration, subject to any surcharges if the property value exceeds Rs.50 lakh.
However, the NRI seller may apply for a lower TDS deduction certificate under Section 197 to reduce the TDS rate. It is important to ensure that you comply with the TDS provisions and make the necessary TDS payment to the Indian government to avoid any penalties or legal issues in the future.
Additionally, you should also verify whether the NRI seller has obtained a PAN (Permanent Account Number) in India. If the NRI seller does not have a PAN, the TDS rate could be higher.
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