Buying From an NRI Gets Simpler: No TAN Needed From 1 October 2026

The single biggest reason buyers walk away from an NRI seller is about to shrink. From 1 October 2026, a resident individual or HUF buying property from an NRI will not need a TAN to deduct and deposit the TDS. A PAN will do.

For years the deal-killer was the paperwork. When the seller is an NRI, the buyer deducts TDS under the non-resident provisions and, until now, had to obtain a TAN (Tax Deduction Account Number) and file quarterly returns. Most resident buyers did not want the hassle, so they discounted hard or walked. The Finance Bill 2026 changes that.

What changed

Under the Finance Bill 2026, which amends the Income-tax Act 2025, a resident individual or HUF buyer purchasing immovable property from an NRI will be able to deposit the TDS using their PAN instead of a TAN. The reporting moves to a PAN-based mechanism, the same simplification that resident-to-resident property deals already enjoy under the 1% route.

The timeline that matters

This is not live yet. The dates are firm and you should plan around them:

So a sale closing in August 2026 still runs on the TAN rule. A sale closing in November 2026 does not.

What it means if you are an NRI selling

Your buyer pool gets wider. The TAN requirement scared off ordinary resident buyers and shrank your market to those willing to deal with it. Removing it makes your flat as easy to buy, on the compliance side, as any resident's. If your sale can wait until the last quarter of 2026, the friction on the buyer's side drops.

What does not change: the buyer still deducts TDS on the full sale consideration, not on your gain, at 12.5% for long-term gains plus surcharge and cess (an effective maximum near 14.95%). The fix for that remains the lower or nil TDS certificate, which you apply for before the sale. We cover the buyer's full duty in the buyer's TDS guide and the seller's side in TDS on sale of property by an NRI.

FAQ

Does a buyer need a TAN to buy property from an NRI in 2026? Yes, until 30 September 2026. From 1 October 2026, under the Finance Bill 2026, a resident individual or HUF buyer can use their PAN instead of a TAN. Sales closing before that date still need the TAN.

Does this lower the TDS an NRI seller pays? No. It only simplifies the buyer's paperwork. TDS is still deducted on the full sale price at the capital-gains rate plus surcharge and cess. To reduce what is withheld, the NRI seller applies for a lower or nil TDS certificate before the sale.

Is it Form 26QB now for buying from an NRI? No. 26QB is for resident sellers. Buying from an NRI runs through the non-resident TDS provisions and the quarterly NRI TDS return, even after the PAN simplification. See the buyer's TDS guide.

Selling from abroad and want this handled?

66 MG Road coordinates the sale paperwork for NRI owners through vetted CA partners: the lower-TDS certificate, the buyer-side compliance, and the repatriation that follows, with itemized billing and proof at every step. We operate in Mumbai, Pune, Bangalore, Hyderabad, Chennai, and Gurgaon. See TDS and lower-deduction certificates or request a proposal.

66 MG Road newsdesk

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