NRI Tax Filing Guide India — DTAA, Form 15CA/15CB, TDS Rules (2026)

1 Who is an NRI for Tax Purposes?

Your tax status in India is not based on your passport or citizenship — it depends entirely on how many days you physically spent in India during the financial year (April 1 to March 31). Section 6 of the Income Tax Act, 1961, defines three categories of residential status.

The 182-Day Rule (Primary Test)

You are a Resident if you were physically present in India for 182 days or more during the financial year. If you were in India for less than 182 days, you are generally a Non-Resident (NRI).

The 60-Day Rule (Secondary Test)

Even if you were in India for less than 182 days, you can still be classified as Resident if you meet both conditions: (a) you were in India for 60 days or more in the current financial year, AND (b) you were in India for 365 days or more in the preceding 4 financial years combined.

RNOR — Resident but Not Ordinarily Resident

If you qualify as Resident under the above tests but satisfy either of these conditions, you are RNOR: (a) you were an NRI in 9 out of the 10 preceding financial years, OR (b) you were in India for 729 days or less during the 7 preceding financial years. RNOR is a beneficial status — you are taxed like an NRI (only on Indian income) but get resident-level TDS rates.

2 What Income is Taxable for NRIs in India?

As an NRI, only income that is earned in India, accrued in India, or received in India is taxable. Your foreign salary, overseas investments, and income in your country of residence are completely outside the scope of Indian taxation.

3 NRI Income Tax Slabs 2026 (New vs Old Regime)

NRIs do not get any special slab rates — they pay tax at the same rates as resident Indians. However, the choice between old and new regime matters, and for most NRIs, the new regime is better because NRIs typically cannot claim many deductions (no HRA, no 80C via PPF/ELSS easily, limited Section 24 benefit).

New Tax Regime (Default from FY 2025-26)

Rebate under Section 87A (New Regime): If total taxable income does not exceed Rs 8,00,000, the entire tax (up to Rs 30,000) is rebated — effectively zero tax. For NRIs, this means if your only Indian income is Rs 8 lakh or less, you pay no tax under the new regime.

Old Tax Regime

4 TDS Rules for NRIs — Higher Than Residents!

This is the section that hits NRIs the hardest. TDS (Tax Deducted at Source) rates for NRIs are dramatically higher than for resident Indians. The payer (bank, buyer, tenant) is legally required to deduct TDS at these higher rates before paying you.

How to Reduce TDS: Section 197 Certificate

If the TDS being deducted is higher than your actual tax liability, you can apply for a Lower TDS Certificate under Section 197 from your Assessing Officer. Here is the process:

1. Calculate your actual tax liability on the Indian income for the year
2. Apply in Form 13 on the TRACES portal (tdscpc.gov.in)
3. Submit supporting documents — previous ITRs, income projections, PAN card
4. The AO issues a certificate specifying a lower TDS rate (could be nil, 5%, 10%, etc.)
5. Share this certificate with the payer (bank, buyer, tenant) who then deducts TDS at the lower rate

5 DTAA — Double Taxation Avoidance Agreement

DTAA is a bilateral treaty between India and another country that prevents the same income from being taxed in both countries. India has DTAAs with over 90 countries. For NRIs, DTAA can significantly reduce TDS on Indian income — or eliminate it entirely for certain income types.

How DTAA Benefits Work

Under DTAA, the tax rate on specific income types is capped at a lower rate than the domestic rate. You pay the lower of the two rates — the domestic Indian rate or the DTAA rate. The key income types covered are interest, dividends, royalties, and capital gains.

How to Claim DTAA Relief

To claim DTAA benefits, you need to provide the following documents to the payer (bank, buyer, AMC) before the TDS deduction:

1. Tax Residency Certificate (TRC) — obtained from the tax authority of your country of residence (e.g., IRS for USA, HMRC for UK). This proves you are a tax resident of that country.
2. Form 10F — a self-declaration filed on the Indian income tax portal (incometax.gov.in). It contains your details like name, address, tax ID in the foreign country, period of residency, and the DTAA article being claimed.
3. PAN Card — must be active. Without PAN, TDS is deducted at 20% or the applicable rate, whichever is higher.
4. Self-declaration — a declaration that you do not have a Permanent Establishment (PE) in India and that you are the beneficial owner of the income.

Section 90 / 90A / 91 Relief

Section 90: Relief when India has a DTAA with the other country — you pay tax at the lower of the DTAA rate or Indian domestic rate. Section 90A: Relief for agreements between specified associations (rare). Section 91: Unilateral relief when there is NO DTAA — India allows a deduction for tax paid abroad, calculated as the lower of Indian tax on doubly-taxed income or foreign tax paid on that income.

6 Form 15CA and 15CB — Mandatory for Remittances

Whenever money is remitted (sent) from India to a person outside India, the remitter may need to file Form 15CA (an online declaration) and obtain Form 15CB (a CA certificate). These forms ensure that applicable tax has been paid or deducted before money leaves India.

When Are They Required?

Form 15CA/15CB is required for payments that are chargeable to tax in India and are being sent to a non-resident. Common scenarios: sale proceeds of property by NRI, rent payments to NRI landlord, professional fees to NRI consultant, interest payments to NRI.

Step-by-Step Process

1. Determine if Form 15CA/15CB is needed — check if the payment is chargeable to tax and if total remittances exceed Rs 5 lakh in the financial year
2. Hire a CA for Form 15CB (if Part C applies) — the CA verifies the payment, applicable TDS, DTAA benefit claimed, and issues Form 15CB electronically on the income tax portal
3. Log in to incometax.gov.in — go to e-File > Income Tax Forms > Form 15CA
4. Fill Form 15CA — enter remitter details, remittee details, purpose of remittance, amount, TDS details, and the 15CB acknowledgement number (if Part C)
5. Submit Form 15CA — the portal generates an acknowledgement number
6. Download and submit to bank — provide the Form 15CA acknowledgement (and Form 15CB if applicable) to your bank. The bank will process the remittance only after receiving these forms.

7 How to File ITR as an NRI (Step-by-Step)

Which ITR Form to Use?

Most NRIs should file ITR-2. This form covers salary income, house property income, capital gains, and other income — all common NRI income types. ITR-1 (Sahaj) is not available to NRIs. If you have business income in India, use ITR-3.

Documents You Need

• PAN card — must be linked to your phone number for OTP verification
• Form 26AS / AIS — download from incometax.gov.in to verify all TDS deducted against your PAN
• NRO bank statements — for interest income details
• Capital gains statements — from broker or AMC for shares/MF transactions
• Property sale deed — for computing capital gains on property
• Rental income receipts — if you have Indian rental property
• TRC and Form 10F — if claiming DTAA relief
• Bank account details — pre-validated Indian bank account (NRO) for receiving refund

Filing Process

1. Go to incometax.gov.in and log in with your PAN and password
2. Navigate to e-File > Income Tax Returns > File Income Tax Return
3. Select Assessment Year 2026-27 (for FY 2025-26 income)
4. Choose filing status as "Individual" and residential status as "Non-Resident"
5. Select ITR-2 and choose Old or New tax regime
6. Fill in income details — salary (Schedule S), house property (Schedule HP), capital gains (Schedule CG), other sources (Schedule OS)
7. Enter TDS details from Form 26AS — schedule TDS1 for salary TDS, TDS2 for non-salary TDS
8. Claim DTAA relief under Section 90/91 in Schedule FSI (Foreign Source Income) and Schedule TR (Tax Relief)
9. Compute tax, verify the refund or balance payable
10. Submit the return and e-verify

E-Verification for NRIs

NRIs face a unique challenge here. The most common method — Aadhaar OTP — often does not work because the NRI's Indian mobile number may be deactivated. Alternatives:

• Digital Signature Certificate (DSC) — the most reliable method for NRIs. Get a Class 2 DSC from an authorized CA (e.g., eMudhra, Sify). Register it on the ITR portal. This works from anywhere in the world.
• EVC via NRO bank account — pre-validate your NRO account on the portal, then generate EVC through the net banking of that bank (if supported).
• EVC via Demat account — if your demat account is linked to your PAN, you can generate EVC through NSDL/CDSL.
• Send ITR-V by post — if all else fails, take a printout of ITR-V, sign it, and send it to CPC Bengaluru within 30 days. Not recommended as it is slow and unreliable.

8 Claiming TDS Refund as NRI

Because NRI TDS rates are so high (30% on FD interest, 12.5-30% on property sale), many NRIs end up with excess TDS deducted — more than their actual tax liability. The only way to get this money back is by filing an ITR and claiming a refund.

When Do NRIs Get Excess TDS?

• Low total income: If your Indian income is Rs 6 lakh but bank deducted 30% TDS on NRO FD interest, your actual tax is lower (5-10% under slabs), so the excess is refundable
• DTAA benefit: If TDS was deducted at 30% but DTAA rate is 15%, the 15% excess is refundable
• Property sale: TDS deducted at 12.5-30% on full sale consideration, but actual capital gains tax may be much lower after indexation benefit and exemptions (Section 54/54EC)
• Loss set-off: If you have capital losses that offset your gains, the TDS already deducted becomes refundable

Refund Process

1. File ITR-2 correctly with all income and TDS details
2. E-verify the return (using DSC or EVC)
3. Ensure your NRO bank account is pre-validated on the income tax portal — refunds are only sent to pre-validated accounts linked to your PAN
4. The return is processed by CPC Bengaluru — typically within 30-60 days of e-verification
5. Refund is credited directly to your NRO account (not NRE, not foreign account)

9 NRI Tax Filing Checklist

Click each item as you complete it. This covers everything you need before, during, and after filing your Indian tax return as an NRI.

• Determine your residential status for the financial year (182-day / 60-day test)
• Ensure PAN is active and linked to a valid Indian mobile number
• Download Form 26AS and AIS from incometax.gov.in — verify all TDS entries
• Collect NRO bank statements for interest income details
• Collect capital gains statements from broker / AMC / property sale documents
• Obtain Tax Residency Certificate (TRC) from your country of residence (for DTAA claim)
• File Form 10F on incometax.gov.in (for DTAA claim)
• Choose Old vs New tax regime — compare using the calculator above
• Pre-validate your NRO bank account on the income tax portal for refund
• File ITR-2 with all schedules filled (income, TDS, DTAA relief, capital gains)
• E-verify using DSC or EVC (NRO net banking / demat account)
• Track refund status on incometax.gov.in or tin-nsdl.com after 30 days