Union Budget 2026: Simplifying NRI Real Estate Investments
The Union Budget 2026 has brought about a significant change in the process for resident buyers purchasing immovable property from non-resident Indians (NRIs). The requirement for a Tax Deduction and Collection Account Number (TAN) for deducting tax at source (TDS) has been replaced with a Permanent Account Number (PAN). This move aims to ease compliance and streamline real estate transactions.
Previously, buyers had to obtain a TAN to deposit TDS, which added a layer of complexity and burden to the process. 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 have welcomed this change, seeing it as a practical improvement for the real estate sector. 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 monetizing 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, added, “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. He said, “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,” emphasizing its focus on simplified compliance and targeted reforms for NRIs, including electronic Nil/Lower TDS certificates and PAN-based compliance.
N Nagabushana Reddy, CEO and Founder of NBR Group, commented, “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, Budget 2026 aims to reduce compliance hurdles for NRI property transactions, support infrastructure-led real estate demand, and ease capital flow for investors and buyers. These changes are expected to have a positive impact on the real estate market, making it more accessible and attractive for NRIs and other investors.
