Buying in Bangalore as an NRI

Bengaluru’s rules for buying a flat are the same whether you live in Bengaluru, Boston or Bahrain. What changes for a Non-Resident Indian (NRI) or an Overseas Citizen of India (OCI) is not the property law but a layer of foreign-exchange law on top of it: what you may buy, how the money must move, how a loan is repaid, and how much you can eventually send back out. Get that layer wrong and the purchase can still close, but the money can end up stuck on the wrong side of the border.

This guide covers only that added layer—the FEMA rules on acquisition and payment, a home loan as an NRI, buying through a power of attorney, tax deducted at source in both directions, and repatriation. For the documents to check, the RERA filing, the cost sheet and stamp duty, and how much you can afford, the site’s other guides cover those the same way for every buyer, and are linked below where they matter.

What an NRI or OCI may buy

The rule sits in the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, and it is short. An NRI or an OCI may acquire immovable property in India by purchase, by gift from a relative, or by inheritance— with one exception: agricultural land, plantation property and a farmhouse. Buy a flat, a plot approved for housing, an office or a shop, and the rule has nothing more to say. Buy or inherit anything the government still classes as agricultural, and it does.

An NRI is a person resident outside India, under FEMA, who is a citizen of India; an OCI is registered as an Overseas Citizen of India Cardholder under the Citizenship Act, 1955. Both sit under the same rule, with the same exception. If you are a foreign national who is not an OCI, narrower and different rules apply, and this guide does not cover them.

There is no cap on how many residential or commercial properties an NRI or OCI may buy. The cap that does exist—two properties—applies later, to how much of the sale proceeds you may send abroad, not to how many you may own.

The exception is narrower than it sounds in one direction: inheritance. An NRI or OCI who inherits agricultural land, a plantation or a farmhouse from someone who held it lawfully may keep it, and may later sell or gift it only to a person resident in India who is a citizen of India. What you cannot do is go out and buy one.

How you may pay for it

Three routes are open: an inward remittance from abroad through banking channels, or a debit to your NRE, NRO or FCNR(B) account. Nothing else is allowed. The rule is explicit that payment cannot be made by traveller’s cheque, by foreign currency notes, or by any mode other than those three—and it cannot be made from outside India in cash.

Which account you use changes what happens afterwards, particularly if you plan to bring money back out one day.

You can fund a purchase from both: an NRE account for money remitted in for the purpose, and an NRO account for rental income or other Indian earnings put toward it. Keep clear records of which rupees came from which account, and, where they started as foreign exchange, the remittance advice or NRE/FCNR(B) debit that brought them in. That trail is what lets you repatriate the sale proceeds later without running into the NRO cap.

Taking a home loan as an NRI

A bank, or a housing finance company, may lend to an NRI or OCI to buy a residential property in India, under the Foreign Exchange Management (Borrowing and Lending) Regulations, 2018. The loan itself works the same way as any home loan—the same loan-to-value limits, the same stage-linked disbursal for a flat under construction, and the same RBI rules on the Key Facts Statement, rate resets and prepayment charges that the site’s home-loan guide and affordability guide cover in full.

What is specific to an NRI is how the EMI gets paid. RBI’s rule allows four routes: a remittance from outside India, a debit to your NRE, FCNR(B) or NRO account, rental income from the property you bought with the loan, or a relative in India crediting your loan account directly. The loan amount itself is not credited to your NRE or FCNR(B) account—it goes to the seller or the builder, not to you.

One practical point follows from the first section: a bank lends against a property you already qualify to buy under the FEMA rule above, so a home loan will not get you around the agricultural-land exception. And because the lender is taking security over Indian property, expect the usual paperwork—PAN, income proof, and often a power of attorney in favour of someone in India who can sign at each stage—which the next section covers.

Using a power of attorney

Many NRIs are not in Bengaluru for every step of a purchase, so a power of attorney (PoA) does the signing, or the appearing at the sub-registrar’s office, in their place. Getting one that is valid, and usable, takes three separate checks.

• Sign it before the right person. A PoA executed in India is attested by a notary or judicial magistrate. One executed abroad must, under the Registration Act, be authenticated before a Notary Public, a court, judge or magistrate, an Indian Consul or Vice-Consul, or a representative of the Central Government—in practice, the Indian embassy, consulate or high commission where you live. A document from a country that has signed the Hague Apostille Convention can instead be apostilled; in India, the Ministry of External Affairs is the apostille authority.
• Stamp it within three months of arrival. Karnataka’s Stamp Act gives three months from the date an instrument executed only outside India is first received in the state to get it stamped. Miss the window and a Deputy Commissioner can still stamp it, but expect a penalty; do not leave this until the eve of registration.
• Check whether it needs registering in its own right. A Karnataka bill before the legislature would make a power of attorney authorising the transfer of immovable property compulsorily registrable, and require proof that you are still alive when it is used. Its commencement in force was not confirmed at the time of writing; ask your sub-registrar’s office or a lawyer whether it applies on your date.

However it is executed, your PoA holder can then appear on your behalf at the sub-registrar’s office: the Registration Act lets a properly authorised agent appear and sign in place of the person who executed the document, once the registering officer checks that authority. That is what makes it possible to complete a Bengaluru registration without a flight home—see documents to check for what your attorney should be verifying on the ground before signing anything.

Tax deducted at source

Every buyer in Karnataka deducts 1% tax at source on a flat priced at ₹50 lakh or more, under section 393 of the Income-tax Act, 2025, and pays it in using Form 141, quoting the seller’s PAN. That much is the same whichever side of the transaction is an NRI—if you are buying from a resident seller, this is the only TDS you owe, and you do not need a TAN (a tax deduction and collection account number) to pay it.

Buying from an NRI seller is different. The 1% rule sits in one table in section 393; a separate table in the same section, headed for payments to a non-resident, catches “any other sum chargeable under the provisions of this Act” at whatever rate is in force—not a flat 1%, but the rate that actually applies to the seller’s gain. And because that deduction falls outside the 1% table, the exemption that lets an ordinary buyer skip a TAN does not apply: you must apply for one first.

PAN matters on both sides. A seller with no valid PAN pushes the deduction to a higher rate under the Act’s general rule for a missing PAN, and you cannot file the TDS return without a PAN either way. Get the seller’s PAN in writing before you agree a price, not after.

Rental income and repatriation

Rent from an Indian property is taxable in India regardless of where you live, and it is deducted at source the same way as the sale proceeds above—under the non-resident table in section 393, at the rate in force, by whoever pays it. A property manager or tenant paying an NRI landlord should also hold a TAN.

Where you bank the rent affects what you can do with it later. Interest on an NRE account is not included in your total income at all, under a specific exemption for a person resident outside India under FEMA; interest on an NRO account is taxable like any other Indian income. Rent itself, once tax has been deducted, can go into either.

None of this is paperwork you can catch up on later. An authorised dealer bank asks for it before it lets a single rupee leave the country, typically alongside a chartered accountant’s certificate confirming the source and that tax has been paid or provided for.

Stamp duty and RERA still apply

Nothing about being an NRI changes the law that protects the purchase itself. Stamp duty, cess, surcharge and the registration fee are the same rates a resident pays; GST on a flat under construction is the same 5%, or 1% for affordable housing, or nothing once the whole price falls due after the completion certificate. The full breakdown, with a worked cost sheet, is in the cost of buying a flat guide.

RERA protections are identical too. A project must be registered with Karnataka RERA before it is advertised or sold; no more than 10% of the price can be taken before a registered agreement for sale; structural defects carry a five-year builder liability; and a delay entitles you to a refund with interest, or interest for every month you wait, whether you live in Bengaluru or abroad. Check a project’s filing the same way any buyer should, using how to read a RERA filing, before you send a rupee.

Doing it from outside India

Two separate questions sit under “can I do this remotely”: can a bank verify who you are without meeting you, and does the registration itself need you in the room.

Banks can open an NRE, NRO or FCNR(B) account, or complete periodic KYC, using RBI’s video-based customer identification process (V-CIP)—a live, recorded video call that stands in for a face-to-face meeting. There is a catch worth knowing before you rely on it: RBI requires a bank’s V-CIP system to block connections from an IP address outside India, so it is built for use inside the country, not from abroad. Most NRIs instead open the account with certified copies of their identity documents, attested by the Indian embassy or consulate where they live—a route RBI’s KYC rules specifically provide for.

Registration of the sale deed is different: it does not require the buyer’s personal presence at all. A properly authorised power of attorney holder can appear at the sub-registrar’s office in your place, sign, and complete the process, provided the officer is satisfied of that person’s authority to do so. That is the arrangement most NRIs actually use—open the accounts and sign the PoA on a trip to India, or through embassy attestation, and let the attorney handle the rest of the calendar.

Before you buy

• Confirm what you are buying is not agricultural land, a plantation or a farmhouse, whatever the broker calls it—check the record of rights, not the brochure.
• Pay only through an inward remittance, or your NRE, NRO or FCNR(B) account, never by traveller’s cheque, foreign currency notes, or from outside the banking system.
• If a home loan is involved, agree with your lender up front how the EMI will be paid, and from which account.
• Have your power of attorney attested or apostilled before you need it, and get it stamped within three months of its reaching Karnataka.
• Get the seller’s PAN before you agree a price, and if they are an NRI, ask whether they hold a lower-deduction certificate.
• Apply for a TAN before you buy from an NRI seller, not after the deal is signed.
• Keep every remittance advice and account statement from the day you fund the purchase—it is what lets you repatriate the proceeds later.