By Abhinav Chhabra, Ledger Brigade | 20 October 2026

If you live in Toronto, Texas, London or Sydney and are selling a flat in India this season, the paperwork has changed. The Income-tax Act 2025 came into force on 1 April 2026, and the familiar Forms 15CA and 15CB have been replaced. On 1 October 2026 a further change made life easier for the person buying your property.

Here's what changed, and the order to do things in so your money isn't stuck in India longer than necessary.

What changed

1. Forms 15CA and 15CB are now Forms 145 and 146. For remittances on or after 1 April 2026, the remitter files Form 145 (the old 15CA) before the bank sends money abroad. Where the remittance is taxable and above ₹5 lakh in the tax year, it is usually backed by Form 146 (the old 15CB), a chartered accountant's certificate. The governing provisions are now Sections 393, 395 and 397 of the Income-tax Act 2025 (old Section 195) and Rule 220 of the Income-tax Rules 2026 (old Rule 37BB).

2. Buyers no longer need a TAN to deduct TDS from an NRI seller. From 1 October 2026, a resident individual or HUF buying property from a non-resident can deposit and report the TDS through Form 141, a PAN-based challan-cum-statement with a new Schedule E. This was notified in the Income-tax (Fifth Amendment) Rules 2026 (Notification 121/2026, 22 September 2026). Buyers that are companies or firms still need a TAN.

The new schedule asks the buyer for the seller's contact number, email and overseas address, whether or not the seller has a PAN. If there's no PAN, the seller's Tax Residency Certificate number and foreign tax identification number must be given so that TDS isn't deducted at a higher rate. The TDS reported includes surcharge and cess.

The numbers at a glance

Item2026 position
NRI long-term capital gains on property (held more than 24 months)12.5% without indexation, plus surcharge and 4% cess
TDS provision on payments to an NRISection 393(2) (old Section 195)
Buyer TDS route for individual/HUF buyers from 1 Oct 2026Form 141 (PAN-based), Schedule E. No TAN needed. Tax paid within 30 days from the end of the month of deduction
Lower or nil TDS certificateForm 128 (old Form 13), Section 395(1) (old Section 197), applied for on TRACES
Declaration before remittanceForm 145 (old 15CA), Parts A to D
Accountant's certificateForm 146 (old 15CB), for taxable remittances above ₹5 lakh in the tax year with no AO certificate
Treaty paperworkTax Residency Certificate + Form 41 (old Form 10F)
Penalty for not filing, or filing incorrect, Form 145Up to ₹1 lakh (Section 462)
Repatriation limit (FEMA)Up to USD 1 million per financial year from NRO balances, sale proceeds and inherited assets

What it means for NRI sellers

TDS is usually charged on the sale price, not your gain. Without a lower-TDS certificate, the buyer normally deducts tax on the full consideration, because the buyer can't verify your cost. For a long-held flat, that can be roughly twice the tax you actually owe. The excess comes back only after you file your Indian return and the refund is processed.

The certificate has to come first. Form 128 must be filed on TRACES before the transaction. A certificate can't be issued once the TDS has already been deducted.

Form 145 has four parts (A to D), depending on whether the remittance is taxable, whether it exceeds ₹5 lakh in the tax year, and whether you hold an Assessing Officer certificate or a Form 146. Once submitted, it can't be edited, but it can be withdrawn within 7 days. If your bank still asks for "15CA/15CB", point out that for remittances from 1 April 2026 the e-filing portal generates Form 145 and Form 146 instead.

Moving the money is a FEMA question as well as a tax one. Sale proceeds usually land in your NRO account. Under RBI's Master Direction on Remittance of Assets (updated 29 June 2026), you can remit up to USD 1 million per financial year (April to March) from NRO balances, sale proceeds and inherited assets, including transfers to your NRE account (added in June 2026). Instalments must all go through the same bank, which will ask for an undertaking that NRO money comes from your own legitimate receivables in India. Above USD 1 million, RBI approval is needed.

Worked example (illustrative)

Priya lives in Toronto and is a non-resident for Indian tax. She sells a Pune flat for ₹1.2 crore in November 2026. She bought it in 2015 for ₹60 lakh, giving a long-term gain of ₹60 lakh. She has no other Indian income and claims no exemptions.

  • Without a lower-TDS certificate: the buyer deducts on the full ₹1.2 crore. At 12.5% plus 15% surcharge plus 4% cess (an effective 14.95%), that is about ₹17.94 lakh.
  • Estimated actual tax on the gain: ₹60 lakh × 12.5% plus 10% surcharge plus 4% cess (an effective 14.30%) comes to about ₹8.58 lakh.
  • The gap: about ₹9.36 lakh sits with the tax department until her return is processed.

With a Form 128 certificate before the sale, TDS can be set closer to the real liability. Her buyer deposits it on Form 141 using their PAN, and Priya then files Form 145 (Part C, with Form 146) and remits from her NRO account.

Figures are simplified to illustrate the mechanics. Surcharge depends on total income and the amount involved. Priya's Canadian tax position (foreign tax credit, reporting) needs separate advice.

Action checklist

  1. Gather your cost records: the purchase deed, stamp duty, improvement bills and loan papers.
  2. Apply for a lower or nil TDS certificate (Form 128) on TRACES well before the sale deed date.
  3. Tell your buyer about the Form 141 route. If they are a resident individual or HUF, they don't need a TAN. They pay the TDS and furnish Form 141 within 30 days from the end of the month in which they deduct it. Late filing attracts a late fee (Section 427) and interest (Section 398(3)(a)). Share your PAN, overseas address, email and phone number for the statement. If you have no PAN, share your Tax Residency Certificate number and foreign tax ID.
  4. Ask the buyer for the TDS certificate (Form 132), which they download from TRACES after filing, and check the credit appears in your annual tax statement. If your PAN is wrong on the form, the credit won't show.
  5. Collect your Tax Residency Certificate and Form 41 if you plan to claim treaty benefits on any income.
  6. Engage a chartered accountant for Form 146 if the remittance is taxable and above ₹5 lakh, then file Form 145 (e-verified) and give the acknowledgement to your bank.
  7. Track the USD 1 million FEMA limit across the financial year, and route all instalments through the same bank.
  8. File your Indian return to claim any refund, and report the sale in your country of residence.

Frequently asked questions

My buyer is a company. Does the PAN-only route apply? No. Schedule E of Form 141, available from 1 October 2026, can only be filed by resident individual and HUF buyers. Other buyers, such as companies and firms, use the TAN-based TDS process.

Can I move sale proceeds from NRO to NRE? Yes. RBI's Master Direction on Remittance of Assets, as amended in June 2026, expressly includes transfers to NRE accounts within the USD 1 million per financial year limit, after applicable taxes are paid.

Does the 20% with-indexation option apply to me? No. That option, for transfers from 23 July 2024 of property bought before that date, is for resident individuals and HUFs only. NRIs pay 12.5% without indexation.

Download the official documents

Need a hand?

Selling property in India while living abroad means two tax systems, a FEMA limit and a stack of forms. If you'd like to talk it through, email hello@ledgerbrigade.com or book a free diagnostic call. We'll help you map the steps and timeline.

Which step trips people up most: the TDS certificate or the bank paperwork?

Disclaimer: This article is general information, not tax or legal advice. Rules change and individual circumstances differ, so speak to a qualified professional before acting. Any free call offered is general guidance only and does not involve preparing, reviewing, signing or filing returns or forms.

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