Acquisition and transfer of immovable property in outside in

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Sarat Kumar Sahoo (Querist)
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16 October 2014 Qst:

Mr. X a Indian resident want to purchase a immovable property in USA.

Kindly provide detail procedure, rules, regulation under FEMA,RBI,Income Tax, Wealth Tax and any other act?

Its urgent.

Sarat Kumar Sahoo

Sarat Kumar Sahoo (Querist)
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28 October 2014 there is no one in forum to answer my query.

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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14 July 2024 Acquiring immovable property in a foreign country like the USA by an Indian resident involves compliance with various regulations under FEMA (Foreign Exchange Management Act), RBI (Reserve Bank of India), Income Tax Act, and other relevant laws. Here’s a general overview of the procedures and regulations:

### Under FEMA (Foreign Exchange Management Act):
1. **Approval Requirement**: Indian residents need to comply with FEMA regulations for making investments abroad, including acquiring immovable property.

2. **Mode of Payment**: Payment for acquiring the property should be made through normal banking channels in foreign currency.

3. **Limits and Conditions**: RBI has set limits and conditions for outward remittances, which include payments for immovable property abroad. These limits may vary based on the purpose and country.

4. **Formalities**: File Form A2 with the authorized dealer bank for making the remittance. Additionally, Form 15CA and 15CB may be required for remittances under Income Tax Act.

### Under RBI (Reserve Bank of India):
1. **Liberalized Remittance Scheme (LRS)**: Indian residents can remit up to a certain amount per financial year under the LRS for various purposes, including acquiring immovable property abroad.

2. **Documentation**: Provide necessary documents as required by the authorized dealer bank (usually a bank authorized by RBI for handling foreign exchange transactions).

### Under Income Tax Act:
1. **Tax Implications**: Consider the tax implications in India and the USA regarding ownership, rental income (if applicable), capital gains tax on sale, etc.

2. **Form 15CA and 15CB**: These forms are required for making remittances abroad and certify that taxes have been deducted on the income being remitted (if applicable).

### Other Acts and Regulations:
1. **Wealth Tax**: Wealth tax has been abolished in India, so this might not be directly applicable.

2. **Local Laws in USA**: Understand local laws and regulations in the USA regarding ownership of immovable property by foreign nationals.

### Procedure (General Steps):
1. **Research and Legal Advice**: Understand the legal and tax implications both in India and the USA. Seek advice from legal and tax professionals.

2. **Documentation**: Prepare necessary documents such as passport, visa, proof of funds, etc., as required by RBI and the authorized dealer bank.

3. **Remittance**: Arrange for remittance through the authorized dealer bank in India. Complete necessary forms (like Form A2, Form 15CA, 15CB).

4. **Compliance**: Ensure compliance with all regulations under FEMA, RBI, and Income Tax Act.

### Note:
Given the complexity and potential changes in regulations, it's advisable to consult with a qualified chartered accountant or legal advisor who specializes in international investments and taxation. They can provide personalized guidance based on your specific circumstances and the current regulatory environment.

This overview provides a general framework, and specific details may vary based on factors such as the value of the property, location in the USA, and changes in regulatory requirements.

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