DTAA Explained – Avoiding Double Taxation for NRIs Selling Property in Hyderabad, India

One of the biggest concerns for NRIs selling property in India is double taxation — paying tax both in India and again in their country of residence. Thankfully, the Double Taxation Avoidance Agreement (DTAA) ensures you don’t pay taxes twice on the same income.

If you are an NRI selling property in Hyderabad, here’s how DTAA works, and how to make sure you benefit from it.

What is DTAA?

The Double Taxation Avoidance Agreement (DTAA) is a treaty signed between India and other countries to ensure that NRIs are not taxed twice on the same income.

For example:

• You sell a flat in Gachibowli, Hyderabad.

• You pay capital gains tax in India.

• Without DTAA, you would also pay tax on the same income in the US/UK/UAE.

• With DTAA, you can claim tax credit or exemption in your resident country.

👉 India has signed DTAA with over 90 countries, including the USA, UK, Canada, Singapore, and UAE.

DTAA on Capital Gains from Property Sales

• Capital gains from property sales are taxed in India first (since the property is located in India).

• Under DTAA, NRIs can claim credit for this tax while filing returns in their resident country.

• Example:

  • NRI sells property in Hyderabad → Pays 20% LTCG in India.

  • When filing US tax return, the NRI declares this income → claims credit for tax already paid in India.

Types of Relief Under DTAA

1. Exemption Method – Income is taxed only in one country.

2. Tax Credit Method – Income is taxed in both countries, but credit is given in one for taxes paid in the other.

For NRIs selling property in Hyderabad, the Tax Credit Method usually applies.

Required Documents for DTAA Benefits

To claim DTAA relief, NRIs need:

1. Tax Residency Certificate (TRC) from their country of residence.

2. PAN card in India.

3. Form 10F (self-declaration form).

4. Proof of taxes paid in India (TDS certificates, challans).

Real-Life case study

Mr. Reddy, an NRI in California, sold his villa in Kokapet, Hyderabad for ₹3 crore.

• Paid 20% LTCG tax in India.

• Declared sale income in his US tax return.

• Used DTAA to claim foreign tax credit.

• Result: No double taxation.

Why DTAA Matters for NRIs

• Prevents loss of wealth through double taxation.

• Ensures smooth fund repatriation under FEMA.

• Builds confidence in investing in Hyderabad’s booming real estate market.

FAQs on DTAA for NRIs

1. Do I have to pay taxes both in India and abroad?Yes, but DTAA ensures you get credit or exemption to avoid double taxation.

2. Can I claim DTAA if I don’t have a PAN card?No, a PAN card is mandatory for NRI property transactions.

3. Does UAE also follow DTAA with India?Yes, and since UAE has no personal income tax, NRIs there usually pay tax only in India.

4. Is DTAA automatic?No, you must file TRC, Form 10F, and supporting documents.

Why Choose Kaptain Group?

• ✅ Guidance on DTAA compliance for NRIs.

• ✅ End-to-end support: TDS, FEMA, CA certificates, and repatriation.

• ✅ Hyderabad property specialists with global NRI experience.

Final Thoughts

Double taxation can be a nightmare for NRIs. But with DTAA, you can legally reduce your tax liability and protect your property sale proceeds.

At Kaptain Group, we simplify DTAA and ensure you maximize returns when selling property in Hyderabad.

👉 Contact us today for DTAA guidance and stress-free property transactions.