Income Tax for NRIs in India

Hi

I am an NRI, ased in USA. How much money can my parents gift me in an year, without a tax libaility for me in USA? Secondly, does this money need to be sent to an NRO account?

Hi @sanjana

Wherein any individual receives money in excess of 50,000 in any Financial Year without any consideration, such money will be taxed as Income from Other Sources in the hands of the recipient. However, this rule does not apply to money received from any relative, the definition of which includes your parents. Therefore, the amount credited by your father by way of a gift into your NRO account shall not be taxable.

Yes, the money needs to be sent to an NRO account. The gift from your parents cannot be credited to your NRE account. There is no such limit on gifts from relatives. Any gift given by them to you would be tax-free for both parties so far as India tax incidence is concerned.

Hope this helps :slightly_smiling_face:

Thank you for the detailed response. @Divya_Singhvi are you a CA or lawyer or suggest me one. Need someone based in Delhi at the earliest.

Hi @sanjana

I am a Chartered Accountant. We would be happy to help.
You can share your contact number and email id on Quicko | Contact Us so someone from our team can get in touch with you for details, process, pricing, and discounts?
Looking forward to simplifying taxes for you !:slightly_smiling_face:

am a NRI person, would like to file tax ,what’s the first step to do so?

Hi @kiranhbc, here are couple of articles which might help you with understanding taxes for NRIs

If you need help of an expert when filing ITR you can drop your contact details on Quicko | Contact Us and our team will get in touch with you :slight_smile:

Hello, I am OCI. I do have NRE savings accounts, deposit accounts and FCNR deposit accounts. I understand that all the interest earned from these accounts is exempt from the tax. My question is - do I need to file income tax (only for reporting purposes) in case I have interest from these NRE accounts as the ONLY income (no other income in India).

Hi @Chhote
Yes, it is advisable to file ITR. ITR 2 will be applicable in your case.

Thank you @Divya_Singhvi for your response. If I file ITR-2, does that mean

  1. I need to enter the interest income in Schedule OS, and
  2. then use Schedule EI to exempt all of that income?

Seems like this would be only reporting, as I have already included these interest while filing US taxes.

Hi @Chhote

You only need to mention the exempt Interest in Schedule EI.
Schedule OS covers the interest which is taxable.

Yes, it is disclosure of income earned in India.

Hope this helps :slightly_smiling_face:

1 Like

Thank you very much @Divya_Singhvi . Really appreciate your answers. Will refer you and QnA.tax to my friends and relatives for sure!

1 Like

Do NRI get slab benefit of Rs. 2.5 Lakhs if they receive Dividend Income from domestic companies?
(What will be the Total Tax if NRI receives Rs. 65000 as Dividend from Indian Companies?)

Hi there,
I have a question regarding my mothers ITR filing.
My mother is unemployed and the only source of income is my father, who is an NRI.
we recently PURCHASED a property in my MOTHERS name.
All transactions were done through my MOTHERS bank account.
How should we file the ITR in my mothers name?

@Kaushal_Soni @Saad_C @AkashJhaveri @Divya_Singhvi @Laxmi_Navlani can you help with this?

Hey @DrAzygos

Here, property is said to be purchased through your mother’s name as all the transactions were done in her bank accounts.

Such property can be disclosed under the head ‘Income from House Property’ under self-occupied category.

Hope, it helps!

I found that for NRO savings accounts 30% tds is levied on interest income …but normal resident account this interest is taxed as per applicable tax rate. For savings account there is no TDS at all. Why NRO pay such tax i.e. 30% on interest income? Just because their currency is stronger than Indian Rupee ? what I am missing here ?

Hi @Dixita

TDS is deducted as per the provision of Income Tax Act.
Interest earned on the Non Resident Ordinary Account (NRO) is taxable and will be subject to a TDS of 30 per cent, but actual tax payment would be as per their applicable tax slab.
Further, you can claim the refund of excess tax deducted at time of filing ITR.

Hope this helps!

I am an NRI based in USA. What is the best legal way of repatriating money(earned in India) back to USA(easy and fast process, other than a wire transfer). Which type of bank account is needed?
Do I need both NRE and NRO account ? Or can i just transfer money to USA from NRO account directly.

Hi @sanjana

In order to repatriate money you need any one of the below accounts:

  1. Non-Resident External (NRE) or
  2. Non-Resident Ordinary (NRO) or
  3. Foreign Currency Non-Resident (FCNR)

The prime source of deposit in an NRE account is from abroad, therefore the funds available therein are freely repatriable i.e. you can transfer the money back to your country of residence without any approval or any specific documentation whereas the NRO account has restrictions on repatriation.

Yes, you can transfer or remit Indian rupee (INR) from Non-Resident Ordinary (NRO) A/c to an overseas bank account with certain documentation and restrictions.

Hope this helps :slightly_smiling_face:

Hi,
I’m living in US as a student since last 6 months, and have been transferring funds for education purpose to US. I had to transfer additional money for an emergency, and now I want to send it back to India to my account from my US account. The amount to be sent back is around $50,000. What are the tax implications and how should I avoid being taxed?
Thanks