Finance Minister Nirmala Sitharaman has delighted non-resident Indians (NRIs) with an array of reforms unveiled in Budget 2026. These initiatives range from enabling direct investment in equity to simplifying real estate transactions, providing significant advantages for the Indian diaspora. Below is a list of all the reforms presented in today’s Budget for NRIs.
Budget 2026 opens 10% equity window for individual PROI investors
Individual Persons Resident Outside India (PROI) can now invest in equity instruments of listed Indian companies through the Portfolio Investment Scheme. Budget 2026 also proposed to increase the investment limit for an individual PROI under this scheme from 5% to 10%, with an overall investment limit for all individual PROIs to 24%, from the current 10%.
Neeraj Agarwala, Partner, Nangia & Co LLP, “For PROI investors in listed Indian equities, the investment limit has been raised from 5% to 10%, while the aggregate cap has increased from 10% to 24%. This move is expected to deepen capital markets and strengthen foreign investment inflows.”
Sanjay Kumar, Director – Nangia Global Advisors LLP, says, “Ease of Doing Business is strengthened as persons resident outside India are permitted to invest in listed equities via the portfolio route. Doubling the individual cap to 10% and raising the aggregate limit to 24% will deepen markets and also boost FDI inflows.”
Who is going to benefit?
A person resident outside India (PROI) includes any individual or entity that does not meet India’s residency criteria under FEMA. Agarwala mentions, “This broadly covers NRIs, foreign nationals, and overseas entities who live or operate outside India for employment, business, or any long-term purpose. It also includes offices or branches located outside India, even if they are owned or controlled by an Indian resident. In simple terms, if a person or entity is based outside India and does not qualify as a resident, they are treated as a PROI.”
No more TAN hurdles for buying properties from NRIs
To make real estate transactions easier, Budget 2026 has proposed eliminating a requirement for people buying property from non-residents. Currently, if you purchase a property from an NRI valued over Rs 50 lakh, you must get a Tax Deduction and Collection Account Number (TAN) to pay the tax at source (TDS). This has been a hassle for regular homebuyers, as TANs are usually for businesses, but individuals had to apply for one for a single property purchase. In contrast, buying from a local resident only needs a simple PAN-based payment, while the NRI process involves extra paperwork.
To address this, Budget 2026 suggests that resident individuals and Hindu Undivided Families (HUFs) won’t need a TAN when buying from a non-resident. Instead, they can use their regular PAN for tax deductions, making it as simple as buying from a local seller.
Also Read: NRI property transactions: Budget 2026 scraps mandatory TAN requirement for home buyers
Who is going to benefit?
This change will eliminate the need for a TAN for individual buyers, reducing the need for tax consultants for straightforward sales and making the process quicker and less stressful. The new rule will be effective from October 1, 2026.
Budget 2026: Minimum Alternate Tax rule change
The Finance Minister has suggested removing certain non-resident businesses from the Minimum Alternate Tax (MAT) rules if they use the presumptive taxation method.
Currently, some foreign companies do not have to pay MAT, and income from certain non-resident businesses that choose the presumptive tax rate under section 61 is also excluded. However, other businesses that also use this presumptive taxation method are still subject to MAT.
To create fairness among all non-resident businesses that choose presumptive taxation, the Finance Minister has proposed that two more specific types of businesses—those operating cruise ships and those providing services or technology for setting up electronics manufacturing facilities in India for resident companies—will also be exempt from MAT.
This change is set to take effect on April 1, 2026, and will apply to the tax year 2026-27 and beyond.
