NRI Capital Gains Tax Calculator
See the India tax on your property, share or mutual fund sale, the TDS the buyer will withhold under Section 195, and the refund you should expect after ITR-2.
What this NRI capital gains calculator works out
Three numbers that most tools blur together. First, the India tax on one sale: the capital gain, the rate that applies to a non-resident, surcharge if your total Indian income crosses ₹50 lakh, and the 4% cess. Second, the TDS the buyer or the fund house will withhold under Section 195 (Section 393(2) under the Income-tax Act 2025), which for property is charged on the full sale price rather than your gain. Third, the difference between the two: the refund you should expect after filing ITR-2, or the balance you still owe.
It covers property, listed shares sold through a broker, and mutual fund units, including debt fund units bought on or after 1 April 2023 that are always short-term under Section 50AA. It handles the 1 April 2001 and 31 January 2018 grandfathering, the stamp duty value rule under Section 50C (now Section 156), and shows what Section 54, 54EC or 54F could save if you reinvest. The engine uses FY 2026-27 (AY 2027-28) rates for sales on or after 23 July 2024. The US side is out of scope: report the gain on your US return and claim the Foreign Tax Credit, and use the DTAA tax calculator for the treaty view.
How to use the calculator
Step 1: Pick what you sold
Tap Property, Listed shares or Mutual funds. For funds, choose Equity fund if it holds at least 65% Indian equity, otherwise Debt or other fund. The holding period test, the rate and the TDS treatment all follow from this choice.
Step 2: Enter the dates and prices
Purchase date, sale date, purchase price and sale price are all that is required. The sale date defaults to today; change it to test a planned sale. For property, add the cost of improvements if you have bills for capital work. Amounts are in rupees with Indian grouping.
Step 3: Open More options if they apply
Enter your other Indian income for the year so short-term gains land in the right slab and surcharge is placed correctly. Add the stamp duty value for property, the fair market value on 31 January 2018 for shares bought before then, or the fair market value on 1 April 2001 for older property. Tick the reinvestment boxes and, if you already hold a lower deduction certificate (Form 13, now Form 128), enter the certified rate.
Step 4: Read the result and the deadlines
The result names the gain type and rate, the tax, the TDS, and the refund or shortfall, followed by dated actions: the ITR-2 due date and, for property, the last day to buy Section 54EC bonds. Open How we calculated this for the step table and use Modify inputs to run another scenario.
How the tax is calculated for NRIs in FY 2026-27
For any transfer on or after 23 July 2024, indexation is gone and the long-term rate is a flat 12.5% for every asset in scope. Listed shares and equity funds are long-term after 12 months; property, debt funds bought before April 2023 and other assets after 24 months. The Income-tax Act 2025 renumbered these sections from 1 April 2026 but kept the rates. A non-resident cannot use the basic exemption or the Section 87A rebate against special rate gains, and the 20% with indexation option for older property is for residents only. Surcharge on special rate gains is capped at 15%. For the underlying rules see tax on capital gains for NRIs.
| Asset | Long-term after | Long-term rate | Short-term rate | TDS at source |
|---|---|---|---|---|
| Property in India | 24 months | 12.5%, Section 112 (now 197) | Slab rates | Buyer, on the full sale price |
| Listed shares (STT paid) | 12 months | 12.5% above ₹1.25 lakh, Section 112A (now 198) | 20%, Section 111A (now 196) | None at the broker; advance tax |
| Equity mutual fund | 12 months | 12.5% above ₹1.25 lakh, Section 112A (now 198) | 20%, Section 111A (now 196) | Fund house, on the gain |
| Debt fund, bought from 1 April 2023 | Never (Section 50AA) | Not applicable | Slab rates | Fund house, 30% plus cess on the gain |
| Debt fund, bought before April 2023 | 24 months | 12.5%, Section 112 (now 197) | Slab rates | Fund house, on the gain |
Surcharge and 4% cess sit on top of every rate. New regime slabs for FY 2026-27 run from nil up to ₹4 lakh to 30% above ₹24 lakh, and surcharge starts at 10% once total income passes ₹50 lakh.
Why the TDS on an NRI property sale is higher than the tax
Section 195 (now Section 393(2)) tells the buyer to deduct tax on the sum paid to a non-resident. The buyer cannot work out your gain, so without a certificate the deduction runs on the whole price at the long-term or short-term rate plus surcharge and cess, while your liability is on the gain alone. The gap is your money until ITR-2 brings it back. The worked example below is a flat bought in 2015 for ₹60 lakh and sold in September 2026 for ₹1.5 crore by an NRI with ₹20 lakh of other Indian income.
| Step | Actual tax | TDS by buyer |
|---|---|---|
| Base amount | Gain ₹90,00,000 | Sale price ₹1,50,00,000 |
| Rate | 12.5%, Section 112 (now 197) | 12.5%, Section 195 (now 393(2)) |
| Tax | ₹11,25,000 | ₹18,75,000 |
| Surcharge (15%, total income above ₹1 crore) | ₹1,68,750 | ₹2,81,250 |
| Cess (4%) | ₹51,750 | ₹86,250 |
| Total | ₹13,45,500 (14.95% of the gain) | ₹22,42,500 (14.95% of the price) |
| Refund after ITR-2 (due 31 July 2027) | ₹8,97,000 | |
With no other Indian income the same gain sits in the 10% band and the tax falls to ₹12,87,000, but the buyer still withholds ₹22,42,500 because the surcharge on TDS follows the payment size. For the mechanics of the deduction see TDS for NRIs.
How to reduce TDS before you sell
The only lever that changes the amount withheld is a lower or nil deduction certificate (Form 13, now Form 128). Apply to your assessing officer before the sale deed is registered, with the purchase deed, the agreement to sell and your gain computation. It is not retroactive, so start six to eight weeks ahead. Our guide to Form 13 for NRIs walks through the application.
Reinvestment lowers the tax itself. Section 54 exempts a long-term property gain reinvested in one house in India within two years (three if you build), capped at ₹10 crore. Section 54EC exempts up to ₹50 lakh invested in REC, PFC or IRFC bonds within six months of the transfer, with a lock-in of five years. Section 54F does the same for shares or fund units when the entire net proceeds go into one house. Money not yet reinvested by the ITR due date goes into a Capital Gains Account Scheme deposit. The sequencing is covered in planning an Indian property sale as an NRI.
What to do with your result
A refund means deciding whether the gap is worth a certificate; on a ₹1.5 crore sale it usually is. If you are past registration, collect Form 16A from the buyer, confirm the credit in Form 26AS, and file ITR-2 by 31 July of the assessment year, subject to any CBDT extension. A shortfall, typical on listed shares where nothing is deducted, means paying advance tax in the quarter of the sale. Proceeds land in your NRO account and can be repatriated up to USD 1 million per financial year with Forms 15CA/15CB (now Forms 145/146). Then report the gain on your US return and claim the Foreign Tax Credit for the India tax paid. The RNOR status calculator matters if you are moving back, and the residential status calculator confirms you are a non-resident for the year of sale.
Common mistakes NRIs make
- Letting the buyer deduct 1% under Section 194-IA as if you were a resident. It does not apply to non-residents, and the mismatch delays your refund.
- Assuming TDS is charged on the gain. It is charged on the full sale price unless you hold a certificate.
- Expecting indexation or the 20% option on older property. Both are closed to non-residents from 23 July 2024.
- Using the basic exemption or the Section 87A rebate against special rate gains. Neither applies to a non-resident.
- Holding debt fund units bought after March 2023 for years hoping for long-term treatment. Section 50AA keeps them short-term.
- Counting the six months for Section 54EC bonds from the payment date rather than the transfer date.
- Claiming the TDS withheld, rather than the India tax actually paid, as a Foreign Tax Credit on the US return.
Frequently Asked Questions
How to avoid TDS on sale of property by NRI?
You cannot avoid TDS entirely, but you can bring it down to your real tax. Before the sale is registered, apply to the assessing officer for a lower or nil deduction certificate (Form 13, now Form 128 under the Income-tax Act 2025) with your purchase deed, sale agreement and gain computation. The officer certifies a rate close to the tax on your gain and the buyer deducts at that rate under Section 195 (now Section 393(2)). If you plan to reinvest under Section 54 or 54EC, say so in the application. Without a certificate the buyer must deduct on the full sale price and you wait for an ITR-2 refund.
Does NRI get basic exemption limit for capital gains?
Only for gains taxed at slab rates. A short-term gain on property or on a debt fund is added to your other Indian income and the first ₹4 lakh of that total is free of tax under the new regime, so the basic exemption helps. It does not help with special rate gains: long-term gains under Section 112 or 112A (now 197 and 198) and short-term gains on listed equity under Section 111A (now 196) are taxed at their flat rate even if you have no other Indian income. Non-residents also do not get the Section 87A rebate. The calculator applies these rules automatically.
What are the TDS rules for the sale of property by NRIs for FY 2026-27?
The buyer must deduct tax under Section 195 (now Section 393(2)) on the whole sale price, not on your gain. For a long-term gain the rate is 12.5% plus surcharge and 4% cess, which reaches 14.95% once the price crosses ₹1 crore. For a short-term gain the rate is 30% plus surcharge and cess. The buyer deposits the tax, files the non-resident TDS return (Form 27Q, now Form 144) and gives you Form 16A. Budget 2026 lets buyers deduct using their PAN from 1 October 2026 instead of taking a TAN. Only a lower deduction certificate changes the amount withheld.
Do I have to pay tax in the USA if I sell property in India?
Yes. As a US tax resident you report worldwide income, so the gain goes on Schedule D and Form 8949 of your US return, computed in dollars using the exchange rates on the purchase and sale dates. The India tax you actually pay, not the TDS withheld, can be claimed as a Foreign Tax Credit on Form 1116 in the same category of income, which usually removes double taxation under the India-US treaty. This calculator covers only the India side. Use the DTAA tax calculator for the treaty view and keep the India tax challans and ITR-2 acknowledgement for your US filing.
Does the 12.5% rate apply if I bought the property before July 2024?
Yes. The 12.5% rate without indexation applies to every transfer on or after 23 July 2024, whatever the purchase date. The relief added by the Finance (No. 2) Act 2024, which lets a taxpayer pay 20% with indexation if that is lower on property bought before 23 July 2024, is available only to resident individuals and HUFs. Section 112 (now Section 197) keeps that wording, so non-residents get the flat 12.5% with no indexation. For property bought before 1 April 2001 you may still use the fair market value on that date as your cost, which the calculator supports under More options.
Can I use the basic exemption limit against my gains?
Against slab rate gains, yes; against special rate gains, no. The ₹4 lakh basic exemption under the new regime for FY 2026-27 shelters ordinary income and short-term gains on property, unlisted shares and debt fund units. It cannot be set off against long-term gains under Section 112 or 112A (now 197 and 198) or short-term equity gains under Section 111A (now 196) when you are a non-resident. The separate ₹1.25 lakh exemption on listed equity and equity fund long-term gains under Section 112A does apply to NRIs, and the calculator deducts it before applying the 12.5% rate.
Selling in India? Keep more of the sale price.
An NRI advisor in the US maps the TDS, the ITR-2 refund, and the Section 54/54EC options before you sign.