From 1 April 2026, the Income Tax Act 2025 has replaced the long-standing Form 15CA and Form 15CB with two new forms — Form 145 and Form 146. If you are an NRI or making a remittance abroad from India, you need to understand what has changed, what remains the same, and how compliance works under the new regime.
What Were Form 15CA and Form 15CB?
Under the old Income Tax Act 1961, anyone making a foreign remittance from India was required to file Form 15CA — an online declaration — and obtain Form 15CB, a certificate from a Chartered Accountant, before the bank would process the transfer. These forms ensured that applicable taxes were paid before money left India.
Banks required the CA-certified Form 15CB before accepting Form 15CA for most remittances above ₹5 lakh. This system, while effective, had four separate Parts (I, II, III, IV) making it confusing for NRIs and remitters alike.
What Are Form 145 and Form 146?
The Income Tax Act 2025 introduced a streamlined two-form system effective 1 April 2026:
Form 145 (erstwhile Form 15CA) — The online declaration filed by the remitter on the Income Tax portal. It declares the nature of the remittance, its taxability, applicable DTAA provisions, and the tax deducted. This is filed by you or your CA on your behalf.
Form 146 (erstwhile Form 15CB) — The CA certificate issued by a practising Chartered Accountant certifying that the provisions of the Income Tax Act 2025 and relevant DTAA have been complied with. Your bank requires this before processing the remittance.
Key Differences: Old vs New Forms
The core compliance requirement is identical — a remitter must file a declaration (Form 145 / old 15CA) and obtain a CA certificate (Form 146 / old 15CB) for taxable remittances. The key change is in the legal foundation: the forms now operate under Section 402 of the Income Tax Act 2025 instead of Section 195 of the old Act. DTAA provisions, tax treaty benefits, and bank submission procedures remain broadly the same.
One significant improvement: the new Act has cleaner definitions of what remittances require compliance, reducing ambiguity about which Part to file. Many routine NRI transactions that previously required lengthy Part III filings are now handled under simplified declarations.
Which Remittances Require Form 145 and 146?
Form 145 and Form 146 are required for remittances that are chargeable to tax in India under the Income Tax Act 2025. This typically includes:
Rental income being repatriated by NRIs
Proceeds from sale of property in India
Dividend income from Indian companies
Interest income from NRO accounts above the exempt threshold
Royalty or fee for technical services paid to non-residents
Capital gains from sale of Indian assets
Remittances that are not taxable — such as genuine gifts between close relatives, repayment of loans, or amounts already taxed — may not require Form 146, but Form 145 may still be required as a declaration.
What Does a Practising CA Do in This Process?
Your CA plays a critical role in Form 146 certification. The CA must examine the remittance, verify the nature of income, determine taxability under Indian domestic law and the applicable DTAA, compute the tax payable, verify that TDS has been correctly deducted, and then issue Form 146 under their ICAI registration. This is a professional certification carrying legal accountability — it cannot be auto-generated by software.
At NRI Tax CA, every Form 146 certificate is issued by a Fellow Chartered Accountant with 10+ years of experience in NRI taxation. We handle the DTAA analysis, portal filing, and deliver bank-ready documents within 24–48 hours.
How Long Does It Take and What Does It Cost?
At NRI Tax CA, Form 145 filing starts at ₹2,999 per form, Form 146 certificate at ₹2,999, and the most common Form 145 + 146 combo package at ₹4,999. Turnaround is 24–48 hours from the time you share your documents. Everything is handled over email — no office visit required, regardless of which country you are in.
My Bank Still Asks for 15CA/15CB — What Do I Do?
Some bank branches, particularly those outside major metros, may still reference Form 15CA and 15CB in their remittance forms as of April–May 2026. This is simply a documentation lag. Form 145 is the legal successor to Form 15CA and Form 146 is the legal successor to Form 15CB. Present both forms to your bank along with a brief covering note referencing the Income Tax Act 2025 transition. Most banks are accepting these without issue.
If your bank raises a query, contact us and we will provide a standard covering letter that explains the transition for your bank’s compliance team — at no additional charge.
Whether you need Form 145 only, Form 146 only, or the complete combo package, NRI Tax CA handles everything end-to-end. Submit your details at nritaxca.com/start.html and receive a fixed quote within 2 hours.
Use our free NRI Tax Calculator to instantly estimate your property TDS, refund amount and ITR obligation → Calculate Now
✅ Updated for Income Tax Act 2025. Effective April 1, 2026 — Form 15CA replaced by Form 145, Form 15CB replaced by Form 146.
NRI Rental Income Tax India 2026 — TDS, ITR & DTAA Guide
If you are an NRI with a property in India earning rental income, you are liable to pay Indian income tax on that rent — regardless of which country you live in. The tenant deducts TDS, the income must be declared in your ITR-2, and DTAA may reduce your total tax burden. Done correctly, this is straightforward. Done incorrectly, it results in excess TDS, missed refunds, and compliance notices.
This guide covers everything an NRI landlord needs to know: TDS rates, how to lower them, ITR-2 filing, DTAA treatment of rental income, and how to repatriate rent abroad.
Is Rental Income from India Taxable for NRIs?
Yes. Under the Income Tax Act, income earned from property situated in India is taxable in India regardless of the owner’s residential status. If you are an NRI and your Indian property earns rent, that rent is Indian-sourced income and is subject to Indian income tax.
The tax is computed as follows:
Gross Annual Value (actual rent received or receivable)
Minus: Municipal taxes paid by owner
Equals: Net Annual Value (NAV)
Minus: Standard deduction of 30% of NAV (automatic — no bills needed)
Minus: Interest on home loan (if applicable — no limit for let-out property)
Equals: Taxable rental income
TDS on Rent Paid to NRI — What the Tenant Must Do
When a resident Indian pays rent to an NRI landlord, they are legally required to deduct TDS under Section 195 of the Income Tax Act. This applies regardless of the rent amount — there is no threshold exemption for payments to NRIs.
TDS Rate
Applicable When
30% + surcharge + cess = 31.2%
Standard TDS rate under Section 195
As per DTAA rate
If NRI provides TRC + Form 10F before deduction
As per certificate
If NRI obtains Lower TDS Certificate (Form 13)
The standard TDS rate of 31.2% on rent is one of the highest applicable rates for NRI income. Most NRI landlords can legitimately reduce this through DTAA or a lower deduction certificate.
Tenant’s TDS Compliance Checklist
Deduct TDS on rent payment each month at 31.2% (or applicable DTAA rate)
Deposit TDS with the government by the 7th of the following month
File Form 27Q (TDS return for NRI payments) quarterly
Issue Form 16A to the NRI landlord within 15 days of filing 27Q
If the tenant does not deduct TDS, they become personally liable for the tax amount plus interest and penalty. This is a common source of disputes between NRI landlords and resident tenants.
How to Reduce TDS on NRI Rental Income
Option 1 — DTAA Benefit
Most DTAA treaties treat rental income (income from immovable property) as taxable in the country where the property is situated — which means India. The DTAA generally does not reduce the Indian tax rate on rental income, but it does eliminate double taxation by requiring your country of residence to give you credit for Indian taxes paid.
However, TDS at source can still be reduced if the NRI provides the tenant with a Tax Residency Certificate (TRC) and Form 10F. While the DTAA treaty rate on rent may match the domestic rate in some cases, the formal submission signals to the tenant that the NRI is a legitimate tax resident of a treaty country and can support a Lower TDS application.
Option 2 — Lower TDS Certificate (Form 13)
The most effective way to reduce TDS on rental income is to apply for a Lower or Nil TDS Certificate under Section 197. This is filed as Form 13 on the Income Tax portal by the NRI (or their CA).
The certificate specifies the exact TDS rate the tenant must apply — based on the NRI’s actual tax liability after deductions, exemptions, and DTAA credits. For a property with significant home loan interest, the actual taxable income after all deductions may be much lower than the gross rent, resulting in an effective tax rate far below 31.2%.
Application must be filed well in advance — processing takes 4–8 weeks
Certificate is valid for the financial year specified
Once issued, share with tenant — tenant deducts at the certified rate
Renew every financial year
DTAA Treatment of Rental Income — By Country
Country
DTAA Treatment of Indian Rental Income
Double Tax Eliminated?
🇦🇪 UAE
Taxable only in India (UAE has no personal income tax)
Yes — no UAE tax liability
🇺🇸 USA
India has primary right to tax; USA gives Foreign Tax Credit
Yes — credit mechanism prevents double tax
🇬🇧 UK
India has primary right to tax; UK gives credit for Indian tax
Yes — credit mechanism prevents double tax
🇦🇺 Australia
India has primary right to tax; Australia gives foreign tax offset
Yes — offset mechanism prevents double tax
🇨🇦 Canada
India has primary right to tax; Canada gives Foreign Tax Credit
Yes — credit mechanism prevents double tax
🇸🇬 Singapore
India has primary right to tax; Singapore exempts or credits
Yes — treaty provides relief
Unlike NRO interest where DTAA reduces the rate at source, rental income is typically taxable in India at full Indian rates under most treaties. The key benefit is that you are not taxed twice — your country of residence gives you credit for the Indian tax you pay.
How to File ITR-2 for NRI Rental Income
NRIs must use ITR-2 to declare Indian rental income. ITR-1 is not available for NRIs. The ITR-2 for FY 2025-26 must be filed by July 31, 2026.
Documents Required
Form 16A from tenant (shows TDS deducted and deposited)
Rent agreement and rent receipts
Municipal tax receipts (if paid by you)
Home loan interest certificate (if applicable)
Tax Residency Certificate (for DTAA claim)
Form 10F (if claiming DTAA benefit)
PAN card and Aadhaar (linked)
Key Schedules in ITR-2
Schedule HP — House Property income computation (gross rent, standard deduction, home loan interest)
Schedule TR — DTAA relief claimed (tax paid in India credited against foreign tax liability)
Schedule FA — Foreign assets disclosure (required if you hold foreign assets as well)
Schedule AL — Assets and liabilities (if total income exceeds ₹50 lakh)
Repatriating NRI Rental Income Abroad
Once rent is credited to your NRO account, you can repatriate up to USD 1 million per financial year under the RBI’s Liberalised Remittance Scheme (LRS) for NRIs. The process requires a CA certificate under the Income Tax Act 2025.
Repatriation Process Under the New Forms (From April 2026)
Form 145 (replaced Form 15CA) — Filed by the remitter (you) on the Income Tax portal. Declares the nature of remittance, amount, applicable DTAA provision, and TDS compliance.
Form 146 (replaced Form 15CB) — Certificate issued by a CA after examining the transaction. Certifies that applicable taxes have been paid or provided for, that the DTAA provision cited is correct, and that the remittance is compliant.
Form 146 requires your CA to analyse whether the rental income has been correctly assessed, whether TDS was deducted at the right rate, whether any DTAA relief has been properly applied, and whether the ITR for the relevant year has been filed. This cannot be automated — it requires professional judgment on the specific facts of your case.
Tax Computation Example — NRI in Australia with Rental Property
Item
Amount
Annual rent received
₹6,00,000
Municipal taxes paid
₹18,000
Net Annual Value
₹5,82,000
Standard deduction (30%)
₹1,74,600
Home loan interest
₹2,40,000
Taxable rental income
₹1,67,400
Tax at 30% slab
₹50,220
TDS deducted by tenant (31.2% of ₹6L)
₹1,87,200
TDS refund due
₹1,36,980
This example shows why filing ITR-2 is critical even when TDS has already been deducted — in many cases, the actual tax liability after deductions is significantly lower than the TDS already paid, resulting in a substantial refund.
Common Mistakes NRI Landlords Make
Not informing the tenant to deduct TDS — If TDS is not deducted, the tenant becomes a defaulter. More importantly, you cannot claim the TDS credit that was never deducted. Ensure the tenant is compliant from day one.
Not filing ITR-2 annually — Even if TDS covers all tax liability, ITR-2 must be filed to claim refunds, formally record DTAA claims, and avoid notices from the Income Tax Department.
Not claiming home loan interest deduction — For a let-out property, there is no cap on the home loan interest deduction. NRIs with home loans on rental properties often leave a significant deduction unclaimed.
Not applying for Lower TDS Certificate — The standard 31.2% TDS locks up significant cash for 12–18 months until refund. A Form 13 application costs a small CA fee and recovers lakhs upfront.
Assuming rent cannot be repatriated without a CA — Repatriation requires Form 145 + Form 146. Attempting to transfer without these documents is a compliance breach. Budget for this as part of your annual cost of holding Indian property.
Not disclosing rental income in the home country’s tax return — Most countries tax their residents on worldwide income. While DTAA prevents double tax via credit mechanisms, you are still required to disclose Indian rental income in your Australian, UK, US, or Canadian return. Failure to disclose is a separate compliance issue in your country of residence.
Frequently Asked Questions
My tenant is not deducting TDS. What do I do?
Your tenant is legally obligated to deduct TDS under Section 195. Remind them in writing. If they continue not to deduct, they face interest (1% per month) and penalty. As the landlord, you can still file ITR-2 declaring the gross rent and pay the tax yourself — but you cannot claim a TDS credit that was never deposited. It is in your interest to ensure the tenant complies.
I have multiple rental properties in India. Does each need separate compliance?
Each property is reported separately in Schedule HP of your ITR-2. TDS is deducted separately by each tenant. However, the DTAA claim, Form 10F, and Lower TDS Certificate apply to you as the NRI taxpayer — not per property. One CA can handle all properties in a single ITR-2 filing.
Can I claim deductions on a property that is vacant?
A vacant property can be treated as “deemed let out” under Section 23, where the annual value is estimated based on comparable market rents. Alternatively, if you can establish it was genuinely not let out, you may claim it as self-occupied — in which case no rental income is taxed but home loan interest deduction is also capped at ₹2 lakh. A CA should advise on the optimal treatment based on your specific circumstances.
My property is managed by a property management company. Who deducts TDS?
If the property management company collects rent and remits it to you, they are the payer and are responsible for TDS deduction under Section 195 if they know you are an NRI. If the company collects rent on your behalf and the final tenant is the payer, it depends on the arrangement. This should be clarified in your property management agreement — an incorrect TDS deduction setup creates compliance risk for both parties.
How do I repatriate my rental income to my bank account abroad?
Rental income received in your NRO account can be repatriated up to USD 1 million per year. The process: your CA prepares Form 146 after reviewing your ITR and TDS compliance. You then file Form 145 on the Income Tax portal. Both documents are submitted to your bank, which processes the international transfer. Do not attempt repatriation without these documents — banks are required to verify compliance before remitting.
Is the Standard Deduction of 30% available to NRIs?
Yes. The 30% standard deduction on Net Annual Value is available to all property owners, including NRIs. It is automatic — no bills, no proof of repairs or maintenance is required. It covers all repairs, maintenance, and property management expenses as a flat deduction.
How We Handle NRI Rental Income at NRI Tax CA
Our rental income service for NRIs covers the complete compliance cycle — not just ITR filing. We advise on Lower TDS Certificate applications, ensure DTAA is correctly applied, file ITR-2 with all deductions claimed, and prepare Form 145 and Form 146 for repatriation. Our fee is fixed. There are no hidden charges based on refund amount or property value.
Service
Price
NRI ITR-2 — Rental income (single property)
Starting ₹3,999
NRI ITR-2 — Multiple properties + DTAA
Starting ₹5,999
Lower TDS Certificate (Form 13) application
Starting ₹2,999
Form 145 + 146 for rental income repatriation
Starting ₹5,999
Have rental income in India and unsure if your compliance is correct? Email hello@nritaxca.com — we’ll review your situation at no charge and tell you exactly what’s needed.
Calculate your NRI rental income tax and TDS liability with our free NRI tax calculator. Need help filing ITR or Form 15CA/15CB? Talk to our CA team at Bilash Paul & Associates.
Updated April 2026. Reflects Income Tax Act 2025 — Form 145 (replaces Form 15CA) and Form 146 (replaces Form 15CB) effective April 1, 2026.
Selling property in India as an NRI involves far more than finding a buyer and signing a sale deed. The tax and compliance requirements — if missed — can result in penalties, blocked remittances, or notices from the Income Tax Department. This guide covers everything you need to know for AY 2025-26.
Who Qualifies as an NRI for Property Sale Purposes?
An individual is treated as an NRI under the Income Tax Act if they spent fewer than 182 days in India during the previous financial year. Residential status determines tax rates, TDS obligations, and repatriation eligibility — so confirming your status before the sale is essential.
TDS on NRI Property Sale — The Buyer’s Obligation
When an NRI sells property, the buyer must deduct TDS before making payment. This is mandatory under Section 195 of the Income Tax Act regardless of the buyer’s own tax status.
The applicable TDS rates are 20% on long term capital gains (property held more than 2 years) and 30% on short term capital gains (held 2 years or less). Surcharge and cess apply on top of these rates, which means the effective TDS deduction can reach 22-23% or higher depending on the sale value.
The buyer must deposit this TDS using Form 26QB and issue Form 16B to the seller within 15 days of filing.
Capital Gains Computation — Long Term vs Short Term
Long term capital gains on property held more than 24 months are computed after applying the Cost Inflation Index (CII) to the original purchase price. This indexed cost is deducted from the sale consideration to arrive at the taxable gain.
For a property purchased in 2009-10 and sold in 2025-26, the CII benefit significantly reduces the taxable gain — often by 40 to 60 percent of the original cost.
Short term gains (property held under 24 months) are taxed at slab rates without indexation benefit, making timing of the sale an important planning consideration.
Exemptions Available to NRIs
Two key exemptions can reduce or eliminate capital gains tax entirely.
Section 54 allows exemption if the NRI reinvests the capital gains in a new residential property in India within 2 years of sale (or constructs within 3 years). The new property must not be sold within 3 years of purchase.
Section 54EC allows exemption up to Rs. 50 lakhs if the capital gains amount is invested in specified bonds (NHAI or REC) within 6 months of the sale date. These bonds have a mandatory lock-in of 5 years.
Form 15CB is a certificate issued by a Chartered Accountant certifying the nature of the remittance, applicable DTAA provisions, TDS computation, and tax liability. It is a mandatory document required by your bank before processing any international remittance.
Form 15CA is an online declaration filed on the Income Tax portal by the remitter, based on the details certified in the 15CB. Together, these two documents form the compliance backbone of any NRI remittance out of India.
Without both documents, no Indian bank will transfer funds abroad — regardless of how much TDS has already been deducted.
DTAA — How Double Taxation is Avoided
India has Double Taxation Avoidance Agreements with over 90 countries including the USA, UK, UAE, Australia, Canada, and Singapore. Under these treaties, capital gains may be taxable only in one country — either India or the country of residence — depending on the treaty provisions.
For example, under the India-UAE DTAA, capital gains on immovable property are taxable in India. However, since UAE levies no personal income tax, no double taxation arises. Under the India-UK DTAA, the gain is taxable in India but the UK allows a foreign tax credit for taxes paid in India.
Proper DTAA analysis before the sale can result in significant tax savings and must be done by a qualified CA.
Repatriation of Sale Proceeds
NRIs can repatriate up to USD 1 million per financial year from the sale of immovable property, subject to the following conditions. The property must have been acquired in accordance with FEMA regulations. TDS must have been correctly deducted and deposited. Form 15CA and 15CB must be submitted to the bank. The funds must be routed through an NRO account.
Repatriation beyond USD 1 million in a single year requires prior RBI approval.
Summary — Key Steps for NRI Property Sale
Confirm your residential status before initiating the sale. Compute capital gains and evaluate Section 54 or 54EC exemptions. Ensure the buyer deducts correct TDS under Section 195. Obtain Form 15CB from a CA and file Form 15CA on the Income Tax portal. Submit both forms to your bank along with the sale deed and other KYC documents. Initiate repatriation through your NRO account within applicable FEMA limits.
Need Help with Form 15CA/15CB or NRI Tax Advisory?
Every NRI property sale is different — the DTAA provisions, exemption eligibility, and TDS computation depend on your specific facts. At NRI Tax CA, we handle the complete compliance process including capital gains computation, 15CB certification, 15CA filing, and repatriation advisory — delivered entirely over email within 24 to 48 hours.
