NRI on TDS Deduction
As an NRI (Non-Resident Indian), there are specific income tax rules related to TDS (Tax Deducted at Source) that you need to be aware of. Here are some key points regarding TDS deductions for NRIs:
TDS on Income✅ TDS is applicable to various types of income earned by NRIs in India, including salary, rent, interest, capital gains, etc.✅ The TDS rates can vary depending on the nature of income and the applicable tax rates.✅ NRIs are required to provide their Permanent Account Number (PAN) to the deductor for proper TDS deduction.
TDS on Interest Income✅For interest income earned by NRIs on fixed deposits, savings accounts, or any other interest-bearing instruments, TDS is deducted at a flat rate of 30% (plus applicable surcharge and education cess) by the payer✅However, if the NRI qualifies for any lower tax rates or exemptions under the Double Taxation Avoidance Agreement (DTAA) between India and their resident country, they can submit the necessary documents, such as Tax Residency Certificate (TRC), to avail of the lower TDS rate.
TDS on Capital Gains✅NRIs are subject to TDS on capital gains arising from the sale of property, shares, or any other capital assets in India.✅The TDS rates for capital gains can vary depending on the type of asset and the holding period.✅NRIs can claim a refund for any excess TDS deducted by filing their income tax returns.
TDS Exemptions✅NRIs can apply for lower TDS rates or claim exemptions by obtaining a Certificate of Lower Deduction or No Deduction from a chartered accountant.✅This certificate is required for specific transactions and helps in reducing the TDS liability for NRIs.
In India, when a buyer buys a property from an NRI, he is liable to deduct TDS (Tax Deductible at Source) at 20%. If a property is sold before two years, a TDS of 30% is applicable.
✅ Short Term Capital Gains - 30%* TDS + Cess✅ Long Term Capital Gains - 20% TDS + Cess
