Does NRIs have to pay income tax in India? The answer is ‘NO’. This is because NRIs already pays their share of income tax in the country they work.
What qualifies as an NRI?
The Income tax department classifies an individual to be a non-resident when:
- You have been residing outside India for a period of 182 days or more during the relevant previous year
- You haven’t been present in India for 60 days or more during the last year and a combined total of 365 days or more during the last 4 years
When do an NRI have to pay tax in India?
An NRI can be taxed in India only on the capital gains he had with the investment in India. So, for all the income he earned abroad he’s not liable to pay any tax on it because it doesn’t fall under Indian income tax acts but here are a few categories under which he’s liable to pay income in India:
Salary: Salary which is earned in India under or income generated by a business in liable to pay tax in India.
Property and Assets: Any income or capital gain that has been generated from the sale, rent or leasing of a valued property or an asset based in India will be taxed as per the Income Tax act.
Securities and Investments: Income or capital gains earned investments are also liable to be taxed.
Conditions for Income Tax:
You are qualified to pay taxes when:
- The taxable income of the NRI in India during that financial year is more than 2.5 lakh INR, which is the new exempted limit
- You must have earned capital gains from the sale of any investment or property, even if the gains are less than the exemption limit.
There are many agencies providing NRI services in India. These NRI services offer variety of legal services such as assistance and advisory services related to taxation, property investment, banking service, immigration and consultancy services.