Key takeaways
- No inheritance tax in India; later income and gains are the heir's.
- Send up to US$1 million a year with Forms 145 and 146 and the inheritance papers.
- US: Form 3520 over US$100,000; UK, Canada, Australia: no tax on receipt.
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Step by step
- Gather the documents: death certificate, the will (with probate where required) or a succession or legal heir certificate, your PAN, passport and proof of relationship.
- Claim each asset as nominee or legal heir:
- Bank deposits: the bank’s claim form; funds go to your NRO account.
- Shares: transmission to your NRI demat account through the depository participant.
- Mutual funds: transmission request with the fund house or registrar.
- Property: mutation in the land records and the society; then sell or keep.
- Settle Indian tax: no tax on the inheritance itself, but income after the date of death (interest, rent) and gains when you sell are yours to report. Property sales attract TDS; a lower TDS certificate (Form 128) avoids excess.
- Send it abroad: up to US$1 million per financial year from NRO balances, sale proceeds and inherited assets, with Form 145, a CA certificate in Form 146 and the inheritance documents. Larger amounts can be spread over years or approved by the RBI.
What your country expects
| Where you live | Tax on the inheritance | Reporting |
|---|---|---|
| United States | None for you | Form 3520 for bequests from a foreign person over US$100,000; later income and gains are taxable in the US |
| United Kingdom | No UK tax on receiving it | Later Indian income and gains are taxable in the UK |
| Canada | None | T1135 if your foreign property costs over CAD 100,000 |
| Australia | None | Keep the will and claim papers for the ATO; later income and gains are taxable |
| Europe | Possibly | Several countries tax inheritances received by residents |
Tips from the field
- Start with the nominations: a nominee claim is much faster than a succession certificate.
- Do the property mutation before you try to sell.
- Keep every claim letter: the bank sending the money abroad will ask for the chain from the death certificate to the money.
Related: repatriation from NRO, TDS on property sale by NRIs and demat and mutual funds for NRIs.
Sources
- RBI: Master Direction on remittance of assets (USD 1 million limit)
- RBI: FAQs on remittance of assets
- IRS: About Form 3520
Frequently asked questions
Is there inheritance tax in India?
No. India has no inheritance or estate tax. Income earned on the inherited assets after the date of death, and gains when you sell them, are taxable for the heir.
How much inherited money can an NRI transfer abroad?
Up to US$1 million per financial year, covering NRO balances, sale proceeds and inherited assets together, with Form 145, a CA certificate in Form 146 and the inheritance documents.
Do I pay US tax on an inheritance from India?
No US tax on receiving it, but bequests from foreign persons over US$100,000 in a year must be reported on Form 3520. Later income and gains are taxable in the US.
Can I claim an inheritance in India without travelling?
Often yes. Many claims, transmissions and the transfer can be handled with documents sent from abroad, with signatures attested at the Indian consulate where needed.
Please note: this guide is general information based on the rules as they stood on the review date above. Regulations and RBI/CBDT procedures change often — please get advice on your specific facts before acting.