NRI Income Tax Return Filing

An NRI (non-Indian resident) is either an Indian national or is of Indian descent but does not dwell in India. Taxable income in India determines whether or not NRIs are required to file an income tax return.

Residency Status of ITR Filing for NRIs

For tax reasons, a person's physical presence in India determines residency. For tax purposes, NRI residency can be defined in three ways:

  • An individual's stay in India for less than 60 days during a given financial year is not taxed.
  • If a stay of more than 60 days but less than 182 days and a cumulative stay of less than 365 days in the four years preceding the year in question are met, the individual is exempt from the requirement.
  • Bank Statement
  • Last but not least, if a person leaves India for work outside of the country for a period that is shorter than 182 days in the year of departure,

The Income Tax authorities determine whether a person is a resident of India for a specific financial year based on the above criteria.

Should NRIs File Income Tax Returns in India?

Yes. Non-resident Indians (NRIs) who earn taxable income in India must file an income tax return in India. A good illustration of this would be an NRI who owns a house in India and has a rental income that surpasses the exemption level. NRIs are taxed on the following income streams:

  • Any monetary gain derived from sources in India
  • Income is judged to have accrued or arisen in India.
  • Any money earned in India is taxed.
  • Earnings that are counted as receipts in India.

Only after a tax return for the year in which the loss occurred has been submitted are losses from that year allowed to be carried forward and offset against future income. NRIs must therefore file their income tax forms on time. If the return isn't filed within a year of the end of the applicable financial year, a penalty of Rs 5,000 may be assessed. Finally, a penalty interest of 1 per cent per month on the outstanding tax is charged for late Filing.

When is Income Tax for NRI NOT Required?

Only if the specified conditions are met can an NRI be exempt from filing an Indian income tax return. It is determined that the NRI's total income for the year shall only come from investment income. Capital gains held for a long time are not taxed. Income tax should have been deducted at the source in both cases.

Due Date for NRI Return Filing

The individual must submit NRI income tax returns on or before July 31 after the fiscal year. However, if the NRI is a working partner of a firm whose accounts must be audited, the deadline is September 30. A belated return can be filed by taxpayers who have missed the due date.

Procedure for Filing Return

Online tax returns for NRIs are simple to complete.

  • Using a digital signature to submit the tax return online (DSC).
  • Using an electronic verification code to send the return's tax data electronically. In addition to filing electronically, the following other options are available:
  • Return data transmission via electronic means, followed by return verification submission in the Incoming Taxpayer Receipt Form.
  • The assessee should print out a copy of Form ITR-V if the taxpayer utilizes it. Suitably signed by the assessee, the original document must be forwarded to the Bangalore EDC by post.
  • We provide a paper copy of the tax return (manual Filing of Income Tax return).
  • Taxpayers should be aware that only those over the age of eighty are permitted to file their income tax returns manually. Those filing ITR 1 and ITR 4 for the 2020-2021 tax year can do so manually.

SK Tax Law Firm is a well-known provider of Income Tax Return Filing for NRI or Non Resident Indian. Please make an appointment with one of our specialists to discuss your Nonresident Indian income tax return. GST Registration, GST Return Filing, Income Tax Filing, Trademark Filing, Private Limited Company Registration, and many other services are available. Please get in touch with us for further information on the Filing of income tax return by Nonresident Company. If you have any questions or need to contact us, please email us at info@sktaxlawfirm.com or phone us at +91-9719586772.