While filing Income Tax Returns NRIs need to know these things
Income earned by NRI from abroad is not taxable within India.Some NRIs also have an earning in their motherland country, India in the form of interest from deposits, House property , etc. This income has a basic limit of exemption, which is Rupees Two lac. If the NRI earnings from such sources cross the limit of two lakh, then they should file their tax return.
In addition to the income sources mentioned above, if these NRIs perform transactions in shares, mutual funds and/or similar securities, the monetary gains from the same are also tax accountable, for which they are supposed to file returns. The due date for this, only in case of NRIs, is July 31.
However, there are certain things that NRIs filing returns must take into consideration. By considering the following practical scenarios, one can ease out his/her tax-return filing process in India.
When an NRI should file their income tax return?
Three basic criteria when NRIs should filing the return. These include if their income from the country exceeds the maximum limit permissible as basic exemption, or it can be filed to claim a return if the deducted tax is more than what was payable. To settle the claims for the amount set off as capital losses, one should file his returns.
What all documents do you need as a non-resident Indian?
The documents that one should submit include their passport of the residence country. This shows the total number of days spent outside India for them to qualify as a non-resident Indian. Apart from this, they should provide their de-mat account statements, and the TDS certificates they received from other parties. The statements for de-mat accounts are required for the knowledge of their bank accounts and transactions held in India.
What are the exemptions and the deductions for which you are eligible?
Taking some exemptions benefits an individual can reduce their taxable income. These investments, payment of the principal amount of the housing loan, etc. These exemptions are applicable to NRIs also. So these exemptions can be claim the same under the Income Tax, such as Section 80C by NRIs
There are certain deductions that are specifically not applicable to NRIs. Firstly, NRIs do not benefit from differential exemption limits, based on age and gender, and applicable to resident Indians. Secondly, an NRI’s short-term or long-term capital gains from their investment sale in India, is also not included under tax exemption.
How can NRIs claim a refund?
you should to take the exact bank details to take the refund ,i.e. includes account number,branch MICR code,IFSC Code etc. In case of an online filing of returns, the processing of your refund happens electronically. Therefore, precise bank account details are always helpful.
What alternatives are available to file returns?
The NRIs can file their return through the Income Tax Department’s e-filing portal.
More points to remember while efiling of income tax returns:
One of the point to remember is that an NRI, whose total income during the concerned financial year comprises only of investment earnings and/or long-term capital gains, should not necessarily file the returns. Apart from this, if the tax deduction has already taken place at the income source, then too the non-resident Indian may not file the tax return.
With the assist of above-noted guidelines, NRIs can simplify the complete process of submitting their tax returns in their motherland, India. To have a tax plan and investment plan absolutely in alignment together with your economic goals, you should have a well concept out monetary plan.