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Everything You Need To Know About Income Tax For NRI

RBG Consultant

Tax payment is essential for the betterment of the country and pivotal for fast development. Not just people who are currently living in India but there is also a provision for income tax for NRI i.e. Non-Resident Indians also.

This filing contains various sections where one must provide all the necessary data like personal information, valid documentation, earnings details, and so on. If you are going to file income tax for NRI, then here are the things you should know:

  • When To File & Not To File Income Tax For NRIs: 

Every Non-Resident Indian who is earning some part of their income by investing in various Indian assets, stocks, funds, and other investment options, as well as by being a part of any kind of financial chains and sectors of the country, then they are all liable to file an income tax for NRI. The interest charged for NRIs is about 20% of the income they earn from the country.

 Now, there are certain situations when even a special investment income-earning NRI may not need to file an income tax report. It’s the time when the source of income is only investment options and TDS (Tax Deducted at Source) has already been deducted from their investments. 

  • Which NRI Is Liable For Filing Income Tax? : 

The proof showcasing the NRI status contains documentation of the Overseas resident card, VISA, Work Permit, etc. To decide which NRIs are liable to fill income tax, the residential status of the said NRI is evaluated. There are two separate methods to choose from, one is decided by the FEMA (Foreign Exchange Management Act) and the other by Income Tax Act.  It basically leads to the point in which a person spending a minimum of 60 days in the country per year or more than 365 days in four years is adamant to file the income tax returns. 

  • Exemption Limit In Income Tax: 

Decided by the Union Ministry of India and announced by Finance Minister Nirmala Sitharaman in the Union Budget, the exemption limit for income tax for NRI is Rs. 10 Crore. This limit was increased from Rs. 5 Crore from the last Union Budget. Many other changes were also made to the income tax filing rules for the NRIs in the country. Like the rule of sparing NRIs from double taxation and so on.

  • Other Pointers: 

The Non-Resident Indians of the country get a certain percentage reduction in their income tax filing for NRIs. The standard deduction rate is 30% for property taxes, home loans, etc. Also, the NRIs are allowed to make claims for refunds in case they have been charged with excess income tax than their tax liability. In such situations, NRIs can file an income tax return to the income tax department. 

So, if you are an NRI, then you should pay your income tax amount at the proper time and by providing complete information about the businesses and earnings you have every financial year.

RBG Consultant
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