NRI Real Estate Investment in India: FEMA Rules, LLP Ownership & Repatriation — Complete 2025 Guide
India's real estate market is one of the few asset classes where Non-Resident Indians enjoy near-identical rights to residents. But FEMA rules, TDS obligations, and repatriation limits require careful navigation. Here is a complete 2025 guide.
Key Takeaways
- NRIs can freely purchase residential and commercial property in India under FEMA's automatic route — no RBI approval needed.
- Agricultural land, farmhouses, and plantation properties are off-limits for NRI purchase.
- NRIs can hold LLP units in India — the structure 91Fractal uses — subject to FEMA's capital account transaction rules.
- Sale proceeds can be repatriated (up to USD 1 million per financial year) to NRE account.
- TDS on property purchase from NRI seller is 20–30% (buyer deducts); returns can be filed to claim refund.
- 91Fractal's NRI/HNI minimum slot is ₹25 Lakhs.
Can NRIs Invest in Residential Real Estate in India?
Yes — and with fewer restrictions than many NRIs realise. Under the Foreign Exchange Management Act (FEMA) and the Reserve Bank of India's regulations, NRIs (Non-Resident Indians) and PIOs (Persons of Indian Origin, now OCI cardholders) can purchase, hold, and sell residential and commercial immovable property in India without seeking any prior approval from the RBI. This falls under the "automatic route" — meaning no permissions are required as long as the investment follows prescribed channels.
The key requirement is that payment must be received through proper banking channels: from an NRE (Non-Resident External), NRO (Non-Resident Ordinary), or FCNR (Foreign Currency Non-Resident) account, or by remittance from abroad via normal banking channels. Cash transactions are not permitted.
FEMA Rules: What NRIs Can and Cannot Buy
| Property Type | NRI/OCI Can Buy? | Notes |
|---|---|---|
| Residential flat / apartment | ✓ Yes | Automatic route, no limit on number of units |
| Commercial property (office, shop) | ✓ Yes | Automatic route |
| Under-construction property (RERA registered) | ✓ Yes | Same as ready property; booking amount via banking channels |
| Agricultural land | ✗ No | RBI approval required (rarely granted) |
| Farmhouse / plantation property | ✗ No | Prohibited under FEMA |
| LLP units (indirect real estate) | ✓ Yes* | Subject to FEMA Schedule 9; FIPB/RBI guidelines apply for certain structures |
LLP Investment for NRIs: The 91Fractal Structure
91Fractal structures its co-investment deals as Limited Liability Partnerships (LLPs). NRIs can hold LLP units under FEMA's regulations for Foreign Direct Investment (FDI) in LLPs, subject to certain conditions:
Investments must be in sectors where 100% FDI is permitted under the automatic route (residential real estate for end-use/co-investment qualifies). The investment must be made through inward remittance or from NRE/FCNR accounts. Profits distributed by the LLP can be repatriated to the NRI's home country subject to the annual repatriation limits (USD 1 million per financial year).
How to Invest: Step-by-Step Process for NRIs
Express Interest
Contact 91Fractal at hello@91fractal.com or via the website form. Provide your NRI status, country of residence, and investment appetite (₹25L minimum for NRI slots).
KYC & FEMA Documentation
Submit PAN card (or apply for one), OCI/PIO card, passport, overseas address proof, and NRE/NRO bank account details. 91Fractal guides you through the document checklist.
LLP Agreement Execution
Review and sign the LLP partnership deed (digital signature accepted for NRIs). Your unit allocation and economic rights are documented here.
Fund Transfer
Wire your investment amount from your NRE/NRO/FCNR account or via direct overseas remittance to the LLP's designated bank account. Retain FIRC (Foreign Inward Remittance Certificate) for records.
Hold & Monitor
Receive periodic project updates, RERA milestone notifications, and annual LLP accounts. 91Fractal manages all India-side compliance.
Exit & Repatriation
On deal completion, your post-tax returns are credited to your NRO account. Repatriation of up to USD 1M per year to your overseas account via Form 15CA/15CB process.
Tax Treatment for NRI Investors
Under the LLP structure, tax is paid at the entity level — the LLP pays 31% on profits before distribution. As an NRI partner receiving a distribution, the dividend/profit from an LLP is treated differently from dividends from a company. LLP profit distributions to partners are generally not taxed again in the hands of the partner in India (no double taxation at partner level).
However, NRIs must declare this income in their country of residence as per local tax laws. Many countries (UAE, UK, USA, Singapore, Canada) have Double Taxation Avoidance Agreements (DTAA) with India — your tax advisor can structure the investment to leverage treaty benefits.
Why NRIs Choose Indian Real Estate in 2025
Three structural factors make Indian real estate compelling for the NRI community right now. First, the Indian Rupee has depreciated approximately 30% against the USD over the last decade — meaning an NRI investing in Indian real estate today gets significantly more asset per dollar than five years ago. Second, Indian residential real estate has delivered 10–20% annual capital appreciation in premium micro-markets (Kanjurmarg, Powai, Whitefield Bengaluru) — outpacing most USD-denominated assets. Third, India's RERA regime (post-2017) has dramatically reduced developer default risk and increased project transparency.
NRI? Express Interest in 91Fractal's Mahindra Rainforest Deal
₹25 Lakhs minimum for NRI/HNI investors. Full FEMA-compliant structure. 5× equity amplification on a Grade-A Mumbai project.
Contact the 91Fractal Team Model Your Returns