"Tax Tips for NRIs: Rental Income in India"

The article outlines the taxation rules for NRIs earning rental income from property in India, detailing tax rates, deductions, filing requirements, and measures to avoid double taxation under DTAA. It emphasizes the importance of professional tax advice for compliance and maximizing benefits.


Aspect Details
Taxability Rental income earned by NRIs from property in India is taxable in India.
Income Type Rental income is categorized as "Income from House Property" under Indian tax laws.
Tax Rate Tax is calculated based on the applicable slab rates for NRIs. However, TDS is deducted at a flat rate of 30%.
Standard Deduction NRIs can claim a standard deduction of 30% on the net annual value of the property.
Interest on Home Loan Interest paid on a home loan for the property can be deducted from rental income, subject to conditions.
Tax Deducted at Source (TDS) The tenant is required to deduct TDS at 30% on the rental income before paying it to the NRI landlord.
Filing Tax Return NRIs must file income tax returns in India if their total income exceeds the basic exemption limit.
Avoiding Double Taxation NRIs can claim relief under the Double Taxation Avoidance Agreement (DTAA) if applicable, to avoid paying tax in both India and their resident country.
Currency Conversion Rental income earned in India is taxable in Indian Rupees, even if it is remitted to a foreign bank account.
Professional Help NRIs are advised to seek professional tax advice to ensure compliance and optimize tax benefits.


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