CA Vijay R Singh, FCA
Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
Short answerYes. NRIs can claim Section 54 exemption just like residents. If you sell a long-term residential house and reinvest the capital gain in another residential house in India, that gain is exempt — and because the gain becomes exempt, you can also get a nil or lower TDS certificate so less is deducted at the sale.
What Section 54 gives you
It exempts the long-term capital gain on a residential house if you buy another house (one year before or two years after the sale) or construct one within three years. You reinvest the gain, not the whole sale value.
Conditions to watch
- The new house must be in India.
- Hold it for at least 3 years, or the exemption is reversed.
- If you haven’t bought before your filing due date, park the money in the Capital Gains Account Scheme.
A ₹10 crore cap applies from FA 2023 — confirm the current limits.
Pair it with a lower-TDS certificate
Since the gain is exempt, apply under Section 197 for a nil or low certificate so the buyer doesn’t block TDS you’d only reclaim later. Capital-gains bonds (54EC) are another route. Our NRI property service plans this end to end.