Managing Indian property from abroad: NRI guide to renting and maintenance
NRIs with Indian property can collect rent into an NRO account, manage tenants through a Power of Attorney holder or a property management company, pay property tax through online portals, and ensure TDS compliance by the tenant. Rental income is taxed in India at slab rates after a 30% standard deduction.
Grant a Special POA for property operations from abroad
NRIs managing Indian property from abroad should grant a Special Power of Attorney to a trusted family member or a property management company in India. Rent flows to an NRO account. The tenant must deduct TDS at 31.2% under Section 195. Property tax is payable online through the municipal corporation website. Annual rental income filing in India is required.
Key points
- Special POA for property operations — A Special POA allows a trusted person to sign leases, collect rent, handle repairs and liaise with tenants — without the NRI needing to be present.
- Rent goes to NRO — Rental income from Indian property must be credited to the NRO account — not NRE. It is India-source income.
- Tenant must deduct TDS — Tenants of NRI landlords must deduct TDS at ~31.2% under Section 195 and deposit it with the government — the NRI landlord's responsibility is to ensure compliance.
Setting up property management from abroad
Grant a Special POA to a trusted person or a professional property manager for: signing/renewing tenancy agreements, collecting rent cheques or bank transfers, overseeing repairs and maintenance up to a specified cost limit, paying property tax and society maintenance, responding to tenant complaints.
Choose a property management company: fees typically range from 0.5–1 month rent per year. Verify RERA registration in the state. Get references from other NRI clients.
Set up rent collection: instruct the tenant to transfer rent directly to your NRO account via NEFT/RTGS. Avoid cash rent collection — it creates documentation gaps.
Annual review: monitor property tax payment receipts (payable at the municipal corporation portal), society maintenance and rental agreement renewal.
Tax and compliance for NRI landlords
Tenant TDS obligation: tenants must deduct 31.2% TDS on gross rent under Section 195 and deposit quarterly. Tenant needs a TAN for this.
Lower TDS: apply to your Assessing Officer via Form 13 for a lower TDS certificate if net income after 30% standard deduction and home loan interest is below the slab.
ITR filing: file ITR-2 each year reporting house property income. Claim 30% standard deduction and home loan interest deduction.
Municipal property tax: pay online via the local municipal corporation portal — most major cities (BBMP Bengaluru, MCGM Mumbai, SDMC Delhi, GHMC Hyderabad) have online payment and receipt download.
Frequently asked questions
Can the POA holder sign a new tenancy agreement on my behalf?
Yes, if the POA specifically authorises execution of tenancy/lease agreements. A Special POA should explicitly cover this authority.
What if my tenant refuses to deduct TDS?
The default for non-deduction of TDS lies primarily with the tenant (payer). However, the NRI can also be asked to pay the tax directly. Include TDS obligations in the tenancy agreement and remind tenants in writing.
Can I raise a rent agreement from abroad?
E-stamp and e-registration are available in some states (Karnataka, Maharashtra, Telangana). For states that require physical presence, use your POA holder to complete the registration at the Sub-Registrar's office.