Union Budget 2026 Simplifies NRI Real Estate Transactions by Replacing TAN with PAN
The Union Budget 2026 has introduced significant changes that are expected to simplify the process of real estate transactions involving non-resident Indians (NRIs). One of the key changes is the replacement of the Tax Deduction and Collection Account Number (TAN) with the Permanent Account Number (PAN) for deducting tax at source (TDS) on property sales.
Previously, resident buyers had to obtain a TAN to deposit TDS, which added to the compliance burdens and often delayed transactions. Finance Minister Nirmala Sitharaman announced during her budget speech, “It is proposed to provide that resident individual, or HUF, shall not be required to obtain a tax deduction and collection account number (TAN) to deduct tax at source in respect of any consideration on transfer of any immovable property by non-resident under section 193(2). Instead, the deduction shall be reported by quoting the PAN in the same.”
Experts and industry leaders have welcomed this move as a significant improvement for real estate transactions. Archit Gupta, Founder and CEO of ClearTax, stated, “Simplifying NRI property sales is a structural improvement. Allowing resident buyers to deduct TDS without needing a TAN removes major friction in real estate transactions and should help speed up secondary market sales.”
The budget also signals continued support for real estate investment and infrastructure development. Amit Chopra, President of NAR India, noted, “The removal of the TAN requirement for NRI property sales simplifies compliance, while infrastructure spending and initiatives like REITs for monetising CPSE assets could unlock value and attract institutional capital. However, expectations such as higher home loan interest deductions and revised affordable housing definitions remain unaddressed.”
Chandresh Vithalani, Director at Palladian Partner Advisory Limited, emphasized the broader implications of the budget. “The renewed policy momentum — backed by sustained infrastructure investment and reforms targeting urban expansion — will unlock demand across key micro-markets and support broader investment flows into both residential and commercial segments.”
Sandeep Ahuja, Global CEO of Atmosphere Living, highlighted the positive impact on project viability and lender confidence. “Public capital expenditure and targeted real estate measures will improve project viability and lender confidence. Simplifying TDS on non-resident property transactions by removing the TAN requirement meaningfully reduces friction for NRI buyers, strengthening capital flow and long-term investability across hospitality-led real estate markets.”
Nishant Kohli, Founder and CEO of NRI Nivesh, described the budget as “constructive and forward-looking,” particularly in its emphasis on simplified compliance and targeted reforms for NRIs, including electronic Nil/Lower TDS certificates and PAN-based compliance. “This will make it easier for NRIs to invest in the Indian real estate market, enhancing liquidity and market activity.”
N Nagabushana Reddy, CEO and Founder of NBR Group, emphasized the importance of stability and long-term economic intent in the real estate sector. “The Union Budget sends a message of stability and long-term economic intent, which is crucial for the real estate sector. Continued emphasis on infrastructure development, urban connectivity, and capital expenditure will have a strong multiplier effect on housing demand and construction activity. Real estate performs best in an environment of predictability, and this Budget supports exactly that. Overall, it lays a strong foundation for sustainable growth across residential and commercial real estate in the coming year.”
In summary, the Union Budget 2026 aims to reduce compliance hurdles for NRI property transactions while supporting infrastructure-led real estate demand and easing capital flow for investors and buyers. This move is expected to enhance the overall health and vibrancy of the real estate market in India.
