NRI Income Tax Return In India – NRI/OCI/Expatriate Tax ITR

Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs), Person of Indian Origin Residing Abroad (PIOs), Foreign Citizens Residing In India (Expatriates) are always concerned about compliance of Laws & Regulations. Income Tax Return (ITR) is one of that compliance.

In India, filing of Income Tax Return is a very important and popular compliance (Indian ITR). All NRIs, OCIs, Expats are required to file an ITR India in relation to their Income taxable in India.

Here under are some relevant points, which can be considered by NRIs, OCIs and Expats:

Previous Year and Assessment Year

In India, ITR is filed in Assessment Year (AY) for Previous Year (PY). Previous Year is equavalent to a Financial Year eg if ITR has to be filed for FY 2018-19 then the Previous Year shall be April 1, 2018 to March 31, 2019. And the assessment year shall be 2019-20.

Residential Status

This is one of the most important concept for an Indian ITR. Hence, NRIs/Expats/OCIs need to determine their residential status first. Residential status is determined based of number of days spent in India. This status is categorised in three category (ie Non-Resident ‘NR’, Resident & Ordinary Resident ‘ROR’, Not Ordinary Resident ‘NOR’). Generally, if stay in India is for very limited days during the year, the Residential Status for NRIs/OCIs/Expats etc remain Non-Resident. Briefly, following are relevant points for determination of residential status:

  • If a person stay in India for more than 182 days in a year then he is considered as Resident in India.
  • If a person stay in India less than 60 days in a year then he is considered as Non-Resident in India.
  • If a person stay between 60 days to 181 days in India then based on various parameters his residential status is determined.
  • A person, who is determined as Resident as per above criteria, can be further determined in ROR or NOR. The same is done based on his past 10-11 year stay records.

Taxability

Upon determination of Residential status, Taxability of Income is determined. For Taxability, following are some important points:

  • A person, who is determined as Non-Resident or NOR, is not liable for tax in relation to his foreign income.
  • A person, who is determined a ROR, is liable for tax on his global income in India.
  • Any income either earned in India or received in India is taxable in India despite any residential status.

Double Taxation Avoidance Agreement (DTAA)

Sometimes, it happens

  • That a person is determined a Resident in India, and that person is also considered a Resident in his/her residence/home country as per local laws of that country.
  • That an income is taxable in two countries ie Country of Source (where income is arising) and Country of Resident (where that person is normal Resident).
  • Taxes are levied in two countries.

To provide a relief in such cases and also for some other purposes, DTAAs are entered between various countries. These DTAAs, amongst others, provide for:

  • Determination of Tax Resident Country
  • Determination of Tax ability Country
  • Determination of Tax Rates In Source Country
  • Determination of Tax Relief Provisions If Tax is levied in Source Country
  • Information Exchange Between Tax Authorities of Two Countries
  • Etc

Due Date

  • Indian ITR Due Date is July 31 of Assessment Year.
  • This Due Date is Sept 30 of AY for certain business entities.
  • For NRIs/OCIs, Expats etc generally the Due Date will remain July 31 of the AY.
  • Hence, eg for FY or PY 2018-19 the ITR due date is July 31, 2019.

Components of Income

In India, Income is categorised in 5 categories ie

  • Income From Salary
  • Income From House Property
  • Income From Business of Professiona
  • Income From Capital Gains
  • Income From Other Sources

Deductions, Exemptions, Reliefs 

NRIs, OCIs, Expats, PIOs  can claim various deductions, exemptions, reliefs in their ITR and save taxes.

NRIs Taxability In India

Generally, NRIs/OCIs are liable for following kind of Income In India:

  • Income from House Property (Wrt Immovable Property In India)
  • Interest Income From NRO Bank Accounts In India
  • Gains From Mutual Fund or Shares Traded In Indian Share Market
  • Gains on Sale of Immovable Property In India (Inherited Property/Other Property in India)
  • Salary/Business Income in the year of Migration From/To India

Benefits of Filing Indian ITR

NRIs/OCIs/Expats must file an Indian ITR if there is any Income Taxable In India. In addition to a Statutory Compliance, there are various reasons/benefits for filing of Indian ITR including following:

  • To claim back the refund of TDS deducted in India
  • To report his/her Residential Status as well financial transactions or income incurred/earned in India during a PY
  • To use ITR copy as a legal/govt document for various purposes
  • To keep a track record with the Income Tax Department in India
  • To carry forward of losses (eg loss on Property Sale)
  • To avoid Income Tax Enquiries (ITR plugs many IT Deptt Notices)
  • To avoid Penalty for Non-filing or late filing of ITR

 

S Lohia & Associates – Services & Credentials – Wrt NRI/OCIs/PIOs/Expats ITR

  • Expert Team In handling NRIs Tax Matter incluing NRIs ITR.
  • One Window service in relation to various services of NRIs including ITR.
  • Experience of handling NRIs/OCIs/Expat of various countries across the world.
  • Best Methodologies, Processes & Technologies To provide convenient & effective services.
  • Minimum Litigation.
  • Fast Refund Processing of ITRs.
  • Address Services For NRI ITR.
  • Representative Services For NRI ITR.
  • Having offices/access to across the India Income Tax Offices

Usefulness Of Above Information

Above information can be helpful to NRIs, Expatriates and Other Non-Residents in relation to their various doubts about Indian ITR such as:

  • I am an NRI, I am an Overseas Citizen of India (OCI), I am an Expatriate. I need to know what are the provisions of Indian Income Tax Return in relation to NRI/OCI/Expatriate ITR in India?
  • I am an NRI. I want to know that whether I need to filen an ITR in India?
  • I am an NRI. I want to file an ITR in India and claim back my TDS refund?
  • What are the provisions of residential status and taxability of NRIs in India?
  • What are the benfits of filing an ITR in India by NRI/OCI?
  • What is the due date of filing NRI ITR in India?
  • What is Indian ITR in relation to NRIs taxation?
  • Why NRIs are required to file NRI Tax ITR in India?
  • Chartered Accountant (CA) Services for NRI Tax ITR?
  • Chartered Accountant (CA) Services for Expatriate Tax ITR?
  • CA in Delhi/Mumbai for NRI Tax Matters or NRI ITR?
  • I am NRI. I have an immovable property in India, which is given on rent. Whether filing of ITR is required for transaction?
Contacts

S LOHIA & ASSOCIATES Chartered Accountants 
Address : 1301, Naurang House (13th Floor),
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Connaught Place, New Delhi 110 001.
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