ITR FY 2019-20 – Tax Slabs, ITR Form, Important Changes – NRIs, PIOs, Foreign Citizens

ITR For FY 2019-20 has been due for filing. Now, ITR can be filed anytime on or before due date (Extended Due date for FY 2019-20 ITR filing is November 30, 2020.). Here is a need to understand the important components of Income Tax Provisions, Requirement of New ITR Forms, Tax Rates, Applicability of ITR, Due Date etc. There must be various doubts amongst a vast range of assessees including NRIs, PIOs, Expatriates, Other Individuals. Hereunder is a summary of various provisions and requirements, which can be helpful to the queries of various assessees.

Also Read: How to File ITR in India for NRIs, PIOs, OCIs etc.?

Table of Contents

Tax Slabs

Tas slabs applicable for FY 2019-20 ITR are as under:

Tax Slabs – Applicable on Individuals below 60 Years, Non-Residents (i.e. NRIs, PIOs, OCIs, Other Foreign Citizens)
Total Income Slab (Rs) Tax Rate Tax (Rs)
Upto 250,000 Nil Nil
2.50 Lakh to 5 Lakh 5% 5% of (Total Income – 2.50 Lakhs)
5 Lakh to 10 Lakh 20% 12,500+20% of (Total Income – 5 Lakhs)
More than 10 Lakh 30% 112,500 +30% of (Total Income – 10 Lakhs)
Education & Health Cess: @4% (4% of Tax calculated above) is additionally applicable.
Tax Slabs – Applicable on Senior Citizen Individuals 60-80 Years

(Non-Residents are not eligible for this)

Total Income Slab (Rs) Tax Rate Tax (Rs)
Upto 300,000 Nil Nil
3 Lakh to 5 Lakh 5% 5% of (Total Income – 2.50 Lakhs)
5 Lakh to 10 Lakh 20% 10,000 + 20% of (Total Income – 5 Lakhs)
More than 10 Lakh 30% 110,000 + 30% of (Total Income – 10 Lakhs)
Education & Health Cess: @4% (4% of Tax calculated above) is additionally applicable.
Tax Slabs – Applicable on Super Senior Citizen Individuals (i.e. above 80 Years)

(Non-Residents are not eligible for this)

Total Income Slab (Rs) Tax Rate Tax (Rs)
Upto 500,000 Nil Nil
5 Lakh to 10 Lakh 20% 20% of (Total Income – 5 Lakhs)
More than 10 Lakh 30% 1 Lakh+ 30% of (Total Income – 10 Lakhs)
Education & Health Cess: @4% (4% of Tax calculated above) is additionally applicable.
Surcharge – Applicable to All Types of Individuals (including NRIs, PIOs, Expatriates)
Total Income Slab (Rs) Surcharge Rate
Upto 50 Lakh Nil
50 Lakh to 1 Crore 10%
1 Crore to 2 Crore 15%
2 Crore to 5 Crore 25%
Above 5 Crore 37%
Surcharge is calculated on the Tax calculated as per the slab rates of Individual.
Surcharge of 25% and 37% is not applicable on Capital Gain Income From Shares or Equity Oriented Mutual Funds. On Shares/EO Mutual Funds Capital Gain, surcharge shall be restricted to maximum 15%.
Education & Health Cess: If surcharge is applicable, then cess calculation of 4% shall be made on the tax amount after computing surcharge on the tax amount (i.e. 4% of Tax amount plus surcharge amount).

Also Read: How to File ITR in India for Non-residents for last years?

General Exemptions, Deductions and Reliefs, Which Can Be Claimed In India In FY 2019-20 i.e which NRIs/PIOs/Expatriates can claim in their FY 2019-20 ITR

There are some Exemptions (e.g. NRE Interest, Dividend Income), Deductions (e.g. ELSS, Tax Saving FD, ULIP, House Loan, Donation etc) and Reliefs (Foreign Tax Credit, Gifts From Relatives etc) available to various categories of Individual assessees. These exemptions, deductions, reliefs are allowed/restricted as per the Residential Status of the assessee.

Hence, Non-Residents (NRIs, PIOs, OCIs, Other Foreign Citizens etc) and Residents (Resident Indians,  Resident Expatriates, Resident Migrated NRIs, Residnet Foreign Citizens etc) can claim the benefit of these provisions in computing their Taxable Income at the time of preparation and filing of their ITR.

Here is the link for all these deductions, exemptions and reliefs:-

https://www.slohia.com/income-tax-deductions-exemptions-reliefs-in-income-tax-act-nris-pios-ocis-expatriates/.

New Deductions, Exemptions, Reliefs, Taxability Applicable Wef FY 2019-20 (Amendments Budget 2019)

Following are new, amended deductions, reliefs, which are provided by Budget 2019 and applicable for FY 2019-20 ITR:

Rebate U/s 87A: In case of Resident Individual,whose Total Income {i.e. Taxable Income after deductions under Chapter VIA (80C, 80D, 80G, 80TTA etc)} does not exceed Rs 5 Lakh, rebate of an amount upto Rs 12,500 is allowed from Tax Payable. It means, Tax Payable shall be Nil, if Total Income is within Rs 5 Lakh. This rebate is allowed to Residents only and not allowed to Non-Residents. However, Expatriates, Returned/Migrated NRIs/PIOs (Resident in India) are eligible for this.

Standard Deduction From Salary Income: Standard Deduction of Rs 50,000 (till earlier year Rs 40,000) is allowed from Salary Income. This deduction is allowed irrespective of Residential Status, however, deduction is available if there is a Salary Income. Hence, Expatriates, Recently migrated NRIs, who earn salary income, are eligible for this deduction.

Two House Property Will Be Considered Self Occupied:Till FY 2018-19, if a person had two or more vacant properties, then one property was allowed to consider as Self-Occupied Property. On additional property, a deemed rental income was to be shown and offered for taxation. However, with the amendment by Finance Act 2019, now two properties are allowed as Self-Occupied Property.

Hence, it is a good relief to many Individuals. NRIs, PIOs are much benefitted with the provision as many of them have more than one house property in India (and lying vacant also). Total Interest deduction is allowed upto Rs 2 Lakh only on Self-Occupied Property.

Changes/Amendments in Income Tax Law (via Budget 2019) in relation to NRIs, PIOs, Expatriates, which is effective from FY 2019-20 ITR

In this link [https://www.slohia.com/india-budget-2019-impact-on-nris-ocis-pios-non-residents/] there is a summary of all the amendments, made in Budgt 2019, which is applicable to NRIs, PIOs etc. These are applicable for FY 2019-20 ITR.

ITR Forms Applicable To NRIs, PIOs, Expatriates, Foreign Citizens In FY 2019-20

Generally, as per the general scope of income of NRIs etc, ITR 2 is applicable to NRIs, PIOs, Expatriates (NOR), Foreign Citizens, Returned NRIs (NOR). Hence, generally NRIs need to choose ITR 2 for FY 2019-20 (if no business income). Hereuder, are the general requirement, latest changes etc  in relation to ITR Form 2:

Applicability: ITR 2 is applicable to all NRIs, OCIs, PIOs, NOR Expatriates, NOR Returned NRIs, whose Total Income consists Income from Salary, House Property, Interest Income, Capital Gain Income, Other Sources, but does not include Income From Business/Profession.Hence, ITR 2 is applicable for all kinds of Income of NRIs, however, in case of Business/Profession Income ITR Form 3 or 4 shall be submitted.

Residential Status Details: NRIs, PIOs need to submit information about their Residence i.e. Country of Residence, Tax ID of Residence Country. The new ITR form, which is yet to be notified, may also require information about passport.

India Stay Details: NRIs, PIOs and other Non-Residents are required to submit the details of number of days spent in  India during the relevant FY (i.e. 2019-20) and 4 FYs preceding FY 2019-20 (i.e. FY 2015-16, 2016-17, 2017-18 and 2018-19).

Property Sale Transaction:If there is a property sale transaction (which happens in many NRIs, PIOs cases) then information of PAN or TAN of Buyer also need to be submitted.

Foreign Income/Foreign Assets Details:There is a column in the ITR form 2 for Foreign Income and Foreign Assets. However, NRIs, PIOs, NOR Expatriates, Recently Migrated NRIs/PIOs (NOR) are not required to provide the details of Foreign Assets/Income in their ITR form. Hence, Foreign Assets/Foreign Income details are not mandatory for NRIs etc. This information is applicable only to Ordinary Residents as per Tax Provisions in India.

New 26AS: Now, reference to CBDT Press release of July 18, 2020, there will be new and updated 26AS. Hence, now 26AS will reflect all major financial transaction i.e. Specified Financial Transactions (SFT) of tax payers. Hence, tax payers need to be cautious to include these transactions and file their ITR regularly and accurately.

Income Tax Return In India – More Information

Here are links to various other articles and materials in relation to Income Tax Return in India, which is prepared by our NRIs, Expatriates specialised team:

NRI, PIO, NON-Residents Various OTHER INFORMATION AND services

NRI FY 2019-20 ITR FAQs

Q. Which ITR Form is applicable in India to NRIs, PIOs who are living outside India? Whether NRIs or Non-Residents need to disclose their foreign assets and foreign source of India in Indian ITR?

  • ITR Form 2 is applicable to those NRIs, PIOs.
  • Though ITR Form 2 consists a column for Foreign Assets also, however, that is not applicable to NRIs, PIOs who are Non-Resident in India. Also, this information is not applicable to Returned NRIs who are NOR.

Q. What is Income Tax Return (ITR) In India? What is the Due Date For Filing FY 2019-20 ITR in India? Whether there is any extension in the due date of filing of ITR for FY 2019-20?

  • Income Tax Return is a way to submit details of income and taxes to the Income Tax Department.
  • ITR is filed annually after closure of a financial year, before the specified date.
  • As per the applicability of form, ITR may contain details of personal details, income, expenses, deductions, exemptions, reliefs, assets, liabilities etc.
  • Due date for filing of FY 2019-20 (April 1, 2019 to March 31, 2020) ITR is July 31, 2020 (non-audit assessee).
  • Due date for Tax Audit Report will be Sept 30, 2020 and Tax Audit ITR will be Oct 31, 2020.
  • Presently, there is no extension in the ITR filing of 2019-20 FY. Hence, present due date is same as above.

Q. In Budget 2020, new rule (120 days stay in India by NRIs, PIOs) have been inserted. Whether this new Residential Rules (120 days stay in India) is applicable to FY 2019-20 ITR of NRIs PIOs?

No. New Residential Rules (120 days based resident in India, Deemed Resident in India is applicable wef FY 2020-21.

Q. What is the difference between a Resident Indian and Non-Resident (NRI, PIO) in relation to ITR Tax Slabs in India?

  • There is no difference for below 60 years assesses whether that person is Resident or Non-Resident.
  • However, if a person is Senior Citizen (above 60 years) or Super Senior Citizen (above 80 years) then the extended tax slab is allowed if that person is Resident as per Income Tax Act.
  • Also, in case of capital gains, basic tax slab exemption benefit is not allowed to Non-Residents.

Q. What are the exemptions and deductions, which a Non-Resident (NRI, PIO, Expat) can claim in his ITR Filing in India? Can an NRI invest in tax saving investment and claim deduction? What are the specific allowance and dis-allowances to NRIs in relation to claiming Deductions and Exemptions in India? What are the foreign income tax free in India?

There are various deductions, which an NRI can claim in the computation of Taxable Income In India. Also, there are various income which is exempt from tax. There are certain income, where NRIs are not provided benefit though Indian Residents are provided. Similarly, there are various benefits, which NRI can claim, however, Indian Residents are not allowed that (e.g. NRE Bank Deposit Interest). Here is a summary of all these Deductions, Exemptions, Reliefs etc available to Non-Residents (NRIs, PIOs, Expats). Here, this is also need to know that Non-Residents Foreign Income is tax free in India as it is outside the Tax scope of India as it is earned and received outside India.

Q. What are Non Resident (NRI, Foreign Citizens) Income Tax Slabs for ITR FY 2019-20 (AY 2020-21) in India? How the Net Taxable Income is calculated for applying Tax Slabs? What are the important changes in relation to ITR FY 2019-20 for Non-Resident (NRIs, Foreign Citizens) in India?

For FY 2019-20 ITR of Non-Resident, there is nil tax on Net Taxable Income upto Rs 2.50 Lakhs, 5% tax on Net Taxable Income between 2.50 Lakh Rs to 5 Lakh, 20% on Net Taxable Income between 5 Lakh to 10 Lakh, and thereafter it is 30%. For calculating this Net Taxable Income, deductions under chapter VIA (Tax saving investments, donations etc) are deducted and on balance income the tax slabs applies. There are various changes in relation to FY 2019-20, which needs to be taken care for filing of ITR. One major change is tax rebate u/s 87A, Rs 12500, which is applicable if Total Income after chapter VIA deduction is less than Rs 5 Lakh. This deduction is not available for Non-Residents. However, there are various other changes which are applicable to Non-Residents (NRIs, Foreign Citizens), which can be checked here (https://www.slohia.com/india-budget-2019-impact-on-nris-ocis-pios-non-residents/).