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Do NRI need to file tax in India? How to file IT returns online

Is NRI required to file income tax return? – a very common question. In short – an NRI is liable to pay tax under certain conditions. This post will cover that… We have also touched – how to file NRI income tax return online.

Let us look at the various aspects of filing tax.

Do NRI need to file tax in India

Cases when Income Tax is applicable to an NRI

A Non-Resident Indian (NRI) has to pay tax on any income that is received, accrued or arisen in India. If you are an NRI and have one or more of the following income sources and your income in India exceeds Rs. 2,50,000, you are liable to file tax returns –

  • Interest earned in NRO accounts – It is subject to tax.
  • Rental income – It is subject to TDS of 30%. The tenant is responsible for deducting TDS and submit Form 15CA (and in some cases Form 15CB also) and then pay rent to the NRI.
  • Capital gains on house property or other asset – It is taxable and has to be added to the total income earned.
  • Income from fixed deposits or interest on savings bank account – Income is earned/accrued in India and therefore taxable.
  • Income earned – If you earn income while in India for part of the financial year, you have to file returns for the same.
  • If you have earned income in India for work done abroad, you have to file returns too.

How to file tax return for NRI

Due Date for Filing Income Tax Returns for NRI

The due date for filing income tax returns in India is on or before 31st July for the preceding financial year. So for the financial year – Apr 2017- Mar 2018, you have to file taxes on or before 31st July, 2018.

If as an NRI, you are a working partner in a firm that has not had the accounts audited yet, then you have to file taxes by September 30.

How to file tax return for NRI

You need not be physically present in India to file your tax returns. You can send all the relevant documents, complete the relevant form and sign it and send it to a tax expert in India who can file it for you.

But nowadays it is best to file tax returns online –

  • Get the documents and information such as PAN card, bank statements, income details and deduction details.
  • Register on the Income Tax India website
  • Choose the right ITR form.
  • Select the option on how to file returns. You can e-file your returns or download the relevant ITR complete and upload it.
  • Fill the form and submit it
  • Verify the ITR-V. It can be verified by printing it out, signing it and sending it via normal post or speed post to CPC Bangalore within 120 days of submitting the form. The address is –

Income Tax Department – CPC

                Post Box No – 1

                Electronic City Post Office,

                Bangalore – 560100, Karnataka

  • You will get an acknowledgment on receipt of the form. It can also be verified online or e-verified by using Netbanking, Aadhaar OTP or Bank account number.

The process of Income tax Refund for NRIs

You will get a refund only if you file your tax returns.

So even if you do not have to pay any tax but are eligible for a refund, you will still have to file tax returns. If you want to offset your capital losses against capital gains to lower tax liability, you have to file tax returns.

If you want to offset your capital losses against capital gains to lower tax liability, you have to file tax returns.

wiseNRI

Hope this helps you to file your tax returns this year smoothly. Please feel free to ask questions in the comment section regarding NRI Taxation.

Note – We are not CA but will try to answer based on our learning while working with NRI clients.

Do NRI need to file tax in India

About the Author

Hemant Beniwal is a CERTIFIED FINANCIAL PLANNER and his Company Ark Primary Advisors Pvt Ltd is registered as an Investment Adviser with SEBI. Hemant is also a member of the Financial Planning Association, U.S.A and registered as a life planner with Kinder Institute of Life Planning, U.S.A. He started his Financial Planning Practice in 2009 & is among the first generation of financial planners in India. He also authored Bestseller book "Financial Life Planning".

  • Narendra says:

    i m nri and my employer send money which i hv earned outside india. i m working outside india he send money directly to my nre account ….is it taxable ?

    • Hi Narendra,
      Yes, “income received in India” will be taxed in India. But DTAA can provide some relief – talk to your CA. I will try to write a post on this.

    • Santhosh George says:

      Hi Narendra, As you have mentioned your salary is being sent by the employer to your NRE account, hence it is NOT Taxable (same as they pay you in your place of employment abroad and you send it to your NRE account), but is this the only income source you have. Or else if you have an NRO account or partnered with any business obligations in India then you have to file tax like any Indian resident.

  • Raja says:

    I left India in 1996 and have been living outside India since and have been visiting india only for short periods every year ( once or twice for 2 weeks at a stretch maximum ). I have investments in various banks and have FDs ( both INR and FCNR ) and hold NRE and NRO accounts. My rental income, mutual fund investments is through my NRO a/c only. I have not filed tax returns as yet and tax is deducted at source on my NRO accounts. Apart from these, I do not have any other monies anywhere else to declare. Do I still need to file Income tax since I continue to hold NRI status or should I only file as and when I get back to India?

    • Anuj says:

      Hi Raja,

      If your status is NRI and your total income in india exceeds 250000, you have to pay tax in india and file your return. If your tds is deducted on any income in india, you can easily claim it by filing return.

  • Palu says:

    I am a seafarer works on merchant foreign going ship, for FY 2017-18, I have not completed my nri days, am I need to file income tax? Kindly advise

    • Sneha says:

      Hi Palu,
      Yes, you need to file the Income Tax and you will be liable to pay tax as per the rules applied to NRI.

  • Awadh says:

    I want to know whether Salary income out side India should be disclosed in ITR or not?

  • Phil says:

    Does wise NRI undertake to take file tax returns for NRI from USA?

  • sanjay says:

    i am working abroad for last 7 years , my company remitt my salary directly to my NRE account in india , will this salary be taxed

    • Anuj says:

      Hi Sanjay,

      In your case, your income is accrued or arise abroad, so there is no question of tax in india irrespective of the fact it is credited in NRE Account.

  • Tejas says:

    I am working on ship and have been nri for 10 put of 12 years. Do I have to pay tax for those two years in which one was less than 182 days outside india

    • Anuj says:

      Hi Tejas
      I think in those 2 years your residential status will also be NRI. And if you have income accrue or arise in india during those 2 years, you have to pay tax in india as NRI

  • Balaji says:

    I am an NRI. The last 2 years my Indian income was over Rs 250,000 so I submitted returns to Indian IT dept. But this year onwards my income will fall substantially below this limit. Can I stop submitting future returns?

  • Swati Arora says:

    I want to file the tax as NRI but not getting any option to select the residential status or ‘Filing as NRI’ on the government tax portal. Please suggest how to file the tax as NRI for free online

  • namrata says:

    I was a tax resident in india in the financial year 2018-19 (resident in india for 190 days)…but moved out of the country, I know that i have file return in india for income earned in india but do i need to show my abroad income in the return

  • ANIL KUMAR PODDAR says:

    1.CAN NRI HAVE AN HUF FILE,
    2. DOES NRI IN UK HAS TO DECLARE INCOME IN INDIA IN THEIR TAX RETURN IN UK AND PAY TAX IN INDIAN INCOME IN UK EVEN IF IT IS UNDER TAX EXEMPTION IN INDIA.
    3.DO NRI NEED TO GIVE INFORMATION ABOUT THEIR HUF FILE IN UK TOO.

  • Jaan says:

    Hi,
    I don’t have any income in India and am NRI, but I sent mothly 25000 Rs to my Indian Saving Bank account which is used by my parents every month, so do I require to file ITR in India? I do tax reconciliation abroad where I pay IIT.

  • Ro Sai says:

    Can you give me the name of a good CA in Bangalore who can help with filing taxes as I am an NRI

  • Harmeet Singh says:

    Sir, It seems like the information about NRI income tax return is old ( 2017-18). Now it is 2020.
    You didn’t mention the income from monthly Govt. Pension after retirement from government job. I request you please update the information.
    Thanks

  • Sanjay says:

    Do I need file tax return?

  • Ramakrishnan says:

    I am out of India for two years. I have not submitted any tax returns at this time. I do not have any income in India. Also the Interest I earn from Bank accounts is less than Rs.10000 per year. I did not sell any property. Do I need to file Income tax in India?

  • Ganesh says:

    I have been an NRI since 1997. I have not filed my tax returns so far. My earnings in India, which is house rent is deposited in NRO and TDS is regularly applied directly from the bank. Do I have to submit my returns? Since I have not submitted these many years, can I submit in the future?

    • Avinash says:

      Hi Ganesh

      Yes, It is advisable to file Income Tax returns as you can also get your TDS refunded, if not come under taxable range.
      You can submit your returns in future.

  • Roy says:

    Sir, I am and NRI from Year 2000 , i visit india for 1 month every year. I have Income in india per year from my bank FD the total interest 2,40,000/- per year from which the bank deducting TDS amount almost 30% of the interest. I have LIC approx 10 Lakh , Share for 2 Lakh and ICICI Prudential Life invested 5 Lakh in the year 2011 and the value now is 9 Lakh , do I need to file Tax in india. Do i am eligible to get back the TDS deducted from the year 2010 onwars..

    • Shabana says:

      Hi Roy

      Yes, you are required to file Tax returns to claim your TDS or to pay tax if by any means your Income crosses the limit.
      For knowing the eligibility to get back the TDS amount for so long, kindly consult a Tax expert.

  • Om says:

    I am working in Malaysia since April 2019 so I need to file my income tax return in India or not?

  • Sameer says:

    What are the Income Tax slabs for FY20-21 for NRI?

    • Chetu says:

      Hi Sameer,

      Income Tax slabs are same for NRIs and Residents. For FY20-21, there are 2 options and among them the tax payer can choose any 1.
      Taxable income Tax Rate Tax Rate
      (Option 1) (Option 2)
      Up to Rs. 2,50,000 Nil Nil
      Rs. 2,50,001 to Rs. 5,00,000 5% 5%
      Rs. 5,00,001 to Rs. 7,50,000 20% 10%
      Rs. 7,50,001 to Rs. 10,00,000 20% 15%
      Rs. 10,00,001 to Rs. 12,50,000 30% 20%
      Rs. 12,50,001 to Rs. 15,00,000 30% 25%
      Above Rs. 15,00,000 30% 30%

      Some Tax deductions will differ in both the options, kindly consult with your Tax – Advisor before opting.

  • Sameer Sharma says:

    Dear – I am NRI. In case of Capital Gain by selling the property in Delhi. Will I fall under slab system or flat 20% tax as NRI?

    • Keshav says:

      Hi Sameer

      It depends upon when you had bought the property and when you sold it. If in case it more than 2 years then the buyer will deduct TDS 20% else 30% and you need to file the Income tax return to adjust this with your rest of the income if any.

  • Habib says:

    I am an NRI. I want to open an NRO Demat account in India. The trading will be done through the NRO account in India. The trading account and Demat account will be of a discount broker in India and HDFC NRO account in India. Suppose I transferred an amount of INR 200000 from my NRE account to NRO account or directly in NRO account from abroad and that money will be used to purchase shares of a listed company like TATA motors through a discount brochure in India like pro stocks. How the tax will be calculated?

  • Prem says:

    Hi, I am NRI and working & paying tax in china. I often transfer money to my Indian NRO account through friends by giving them Chinese currency and in return, they give me INR. With that said, do I have to pay tax in India, or do I have to do any annual tax settlement in India since I don’t have income and it’s all tax settlement done in China?

    • Jay says:

      Hi Prem,

      Kindly consult your Tax Advisor. As per my views there will be no tax arise out of this.

      • Janet says:

        I am Executor of my friends Will, she held several Mutual funds in India and I am in process of trying to redeem the funds. I had to open bank account for those funds to go into, do I have to pay tax on any of these? They are only a few thousand pounds in each fund and once collected, I will close bank account. I live in Uk. Thank you

  • Samir C. Shah says:

    My son is in the U.S. and started earning there recently. I got converted his status to NRI on 01st June 2020 (Savings A/c status to NRO & applied for opening his NRE A/c).
    I have Mutual Fund investments (Growth Scheme) in his name that were made 2 years ago (when he was RI).
    If I redeem these MF investments now, what will be the Tax implication on these redemption amounts (for investments made as Resident Indian?)

    • Kundan says:

      Hi Sameer

      Firstly you need to convert the status in his MF holding also. The redemption will be taxed as per the type of MF you hold and for how long.

  • Aditi says:

    I am NRI on h4 visa . Need to file return in india?

  • Venkatavaradan says:

    An NRI has NRO FDs on which TDS has been deducted and he has no other income. The total income of the assessee falls very well below Rs.250000. Kindly clarify whether by filing ITR refund of the TDS can be claimed?

  • Abhishek says:

    I am in US for last 2 years and in the last financial year i was less than 60 days in india. DO i need to file ITR?

  • Thimmaiah says:

    I have a Savings account in INDIA and i get an interest of around 1 lakh . Which is the ITR form that i have to submit is it ITR 1 or ITR2? I have NRE account that is recomended .

  • Ram says:

    As an NRI can I file india taxes with pan card?

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