ITR2 filing for annual year 2025-26

1. In case of NRI, only NRO account can be added

2. If the A/c is enabled for refund on the basis of email matching then no need to worry

3. Assuming property was purchased after 01.04.2001. It includes Purchase cost as per sale deed, brokerage, advocate fees, registration charges, stamp duty charges, interest on housing loan if the benefit of interest is not otherwise claimed in the ITR. You can also claim cost of improvement of capital nature. 

4. You can claim such expenses. Maintain the proofs of such payments in the form of receipt, invoice

For detailed discussion you may opt for phone consultation

✅ 1. NRE Account Not Showing

• Issue: Only NRO shown as account type.

• Solution: Refunds can only go to NRO accounts. NRE accounts aren't eligible.
  → Add only your NRO account for refund purposes.

2. Phone Number Mismatch with Bank

• Issue: Aadhaar/portal and bank have different phone numbers.

• Solution: Since email ID matches and account is EVC-validated, refund will go through.
  → No issue, phone number mismatch won’t block refund.

3. Cost of Acquisition – What to Include

• Allowed: Purchase price, stamp duty, registration, brokerage, legal fees, capital improvements, and interest on loan (if not claimed elsewhere).
  → Enter total of all these with proof.

4. Expenditure on Sale – What’s Allowed

• Allowed: Sale-related expenses like broker fees, legal fees, documentation, etc.
  → Add them under ‘Expenditure in connection with transfer’, retain receipts.

5. Property Tax Deduction

• Not Allowed under LTCG deduction.
  → Cannot be added to reduce capital gains.
  
  

It is obligatory to provide details of all bank accounts in income tax return and not obligatory to validate it on income tax portal.

Non-linking of phone with bank will only not allow you to e-verify return using EVC and not affect your refund.

You can enter total amount paid for purchasing the property and not just cost.

Yes you can enter but I am not sure whether lawyer fees will be allowed as transfer expense as you will have to prove that it was mandatory for transfer.

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Hi, and thank you for your clear and well-structured questions. As an NRI living in Germany filing ITR-2 for AY 2025–26 under the new tax regime, here are precise answers to each of your queries to help you file smoothly:

🔹 1) How to Add NRE Bank Account in the e-Filing Portal (No NRE Option)?

Yes, the e-filing portal currently lacks a direct option for NRE account type under the “Add Bank Account” section.

You can safely select “Savings – Non-Resident Ordinary (NRO)” while entering your NRE account.

The validation is only for refund credit and verification, and there’s no restriction from entering NRE account details with this classification.

 Ensure the account is in your name, active, and capable of receiving INR credits. You won’t face any issues as long as refund processing completes successfully.

🔹 2) Phone Number Linked with Aadhaar ≠ Bank Account — Will It Affect Refund?

You're right — the bank validation process cross-verifies the PAN, name, account number, IFSC, and communication details.

 In your case:

The email ID matched, so your bank account was validated and EVC enabled.

It is NOT mandatory for the phone number linked to the bank to match the e-filing portal or Aadhaar phone number for refund processing, as long as:

• Bank is validated on portal
• Account is pre-validated with EVC enabled
• KYC is up to date

 You’re safe. Refund will be processed smoothly to your NRO account.

🔹 3) “Cost of Acquisition” – What All Can Be Included?

• Property purchase price
• Stamp duty & registration charges
• Brokerage/agent fees paid during purchase
• Documentation charges
• Legal consultation fees for registration
• Cost of improvement, if capital in nature (not maintenance)

All these collectively form your acquisition cost — enter the total sum in that field.

🔹 4) “Expenditure wholly & exclusively in connection with transfer” – What Can Be Claimed?

• This section is for costs directly incurred for the purpose of sale, such as:
• Lawyer consultation fees
• Brokerage or commission paid on sale
• Documentation charges
• Travel or legal due diligence expenses (if done only for sale)

These are fully allowable as deduction under Sec. 48 and will directly reduce your LTCG.

🔹 5) Can I Enter Municipal Property Tax in LTCG Section to Reduce Capital Gain?

- No, municipal/property taxes paid during ownership cannot be claimed to reduce capital gains.

Property tax is a recurring revenue expense, not connected to the cost of acquisition or transfer.

It is not deductible under Sec. 48, which governs LTCG computation.

You can only claim it as house property deduction if you were receiving rent (under Section 24), but not while computing LTCG on sale.

Thanks

Warm regards,

Damini 

Team Witcorp – Expert Tax Help for NRIs & Expats