Selling Inherited Property in India as an NRI in Ghana -- TDS, Capital Gains & Repatriation

How capital gains are calculated on inherited property

Under Section 49 of the Income Tax Act, the cost of acquisition for inherited property carries over from the original owner rather than resetting to the property's value on the date of inheritance, and the holding period counts from the original owner's date of acquisition -- so most inherited-property sales qualify for long-term capital gains treatment, with indexation benefit available where applicable. This computation is identical for an NRI seller based in Ghana as it would be for one based anywhere else.

TDS under Section 195, and getting a lower or nil TDS certificate

Section 194-IA's 1% TDS applies only to resident sellers. For a non-resident seller, the buyer must instead deduct TDS under Section 195, generally on the full sale consideration at the capital-gains rate unless a lower-deduction certificate has been obtained. An NRI seller in Ghana can apply to the jurisdictional Assessing Officer, via Form 13 under Section 197, for a certificate authorizing TDS at a lower or nil rate based on the actual computed gain -- worth evaluating with a chartered accountant before the sale closes.

No DTAA relief -- and what that means in practice

Unlike most countries this platform covers, no India-Ghana Double Taxation Avoidance Agreement currently exists. This was confirmed against both the Ghana Revenue Authority's own published treaty list and the State Bank of India's official DTAA country list, neither of which includes the other country, and this platform found no evidence of negotiations currently underway. In practice, this means an NRI seller in Ghana cannot claim treaty-based relief under Sections 90/90A of the Income Tax Act on the capital gain from an Indian property sale; only India's unilateral relief mechanism under Section 91 would apply where Ghana-source income has also been taxed in Ghana.

Repatriation of sale proceeds via FEMA

Net sale proceeds are typically credited to the NRI's NRO account in India. FEMA rules permit repatriation abroad of up to USD 1 million (or equivalent) per financial year, cumulative across eligible remittances from that account, subject to the authorized dealer bank receiving Form 15CA (and Form 15CB where applicable). This repatriation mechanism is unaffected by the absence of a DTAA -- it is a separate, standing FEMA rule.

Common mistakes in this process

• Assuming the resident 1% TDS rate applies once the seller has become an NRI.
• Assuming DTAA relief is available for capital gains, when no India-Ghana treaty currently exists.
• Not applying for the Section 197 lower-deduction certificate before the sale closes.
• Leaving Form 15CA/15CB paperwork until after proceeds reach the NRO account.