Do NRIs Need to File an Income Tax Return in India?
A Non-Resident Indian is taxed in India only on income that arises or is received in India. Salary earned and received abroad is generally not taxable in India for an NRI. However, an ITR is required or advisable when you have Indian income such as:
- Rent from a house or flat in India
- Interest on NRO savings and fixed deposits (interest on NRE deposits is generally exempt for NRIs)
- Capital gains from selling property, shares or mutual funds in India
- Dividends from Indian companies
- Business or professional income from India
Even where total income is small, filing is the only way to get back excess TDS. Banks, tenants and property buyers often deduct TDS from NRIs at high rates, and the extra amount is refunded only through the return.
A note on the law: returns for financial year 2025-26 are filed under the Income-tax Act, 1961. From tax year 2026-27, the Income-tax Act, 2025 applies with new section numbers, while the core NRI rules remain broadly the same.
Which ITR Form Do NRIs Use?
- ITR-2: most NRIs with rent, interest, dividends and capital gains
- ITR-3: NRIs with business or professional income in India
- ITR-1 is not available to NRIs.
Key Points for NRIs
Residential status comes first
Your tax position depends on whether you are a Resident, Non-Resident or Resident but Not Ordinarily Resident (RNOR) for the year. This is decided by days spent in India and other conditions. See our guide on Change in Residential Status.
TDS on NRO interest and rent
TDS on income paid to NRIs is generally deducted at higher rates than for residents. If your actual tax is lower, the difference is refundable through the ITR.
DTAA relief
India has tax treaties (DTAA) with most countries. Depending on the treaty, you may claim a lower rate in India or credit in your country of residence. Claiming treaty benefits generally needs a Tax Residency Certificate (TRC) from your country of residence and the prescribed declaration.
Capital gains on property
Sale of property in India by an NRI involves TDS by the buyer and capital gains tax, with options to reduce tax through reinvestment. See NRI Property Sale Tax.
Some benefits are only for residents
Certain benefits, such as the rebate that makes small incomes tax-free for residents, are not available to NRIs. Do not assume income below a threshold is automatically tax-free.
Due Date
For most NRIs filing ITR-2, the due date is 31 July after the end of the financial year, unless extended. Late filing attracts fees and interest and can delay refunds.
Documents Required
- PAN, passport and Indian address and overseas address
- Days of stay in India during the year (passport stamps or travel details)
- NRO and NRE bank statements and interest certificates
- Form 16A and TDS certificates; Form 26AS and AIS
- Rent agreement and property tax receipts, for rental income
- Sale and purchase deeds, and broker or mutual fund capital gains statements
- Tax Residency Certificate, if claiming DTAA benefits
- Indian bank account for refund (must be pre-validated)
How We Work with NRIs
- Call or WhatsApp to understand your income and residential status
- Share documents securely online
- We download AIS, compute tax, check DTAA options and share the computation
- File after your approval; you e-verify online (Aadhaar OTP, net banking or DSC)
- We track the refund and respond to any notice
You do not need to visit India or our office.
Common Mistakes NRIs Make
- Not filing at all and losing refunds of high TDS
- Showing NRE interest as taxable, or missing NRO interest
- Wrong residential status for the year of leaving or returning to India
- Not pre-validating an Indian bank account, so refunds fail
- Selling property without planning TDS, capital gains and repatriation in advance
Frequently Asked Questions
Is my foreign salary taxable in India as an NRI?
Generally no. Salary earned and received outside India by a non-resident is not taxable in India, but your status for the year must be confirmed first.
Can I file my ITR while living abroad?
Yes. The whole process is online, and the return can be e-verified from abroad.
The bank deducted high TDS on my NRO FD. Can I get it back?
Yes, if your actual tax liability is lower, the excess TDS is refunded after you file the ITR.
Related Services
- NRI Property Sale and Capital Gains Tax
- Change in Residential Status: Resident to NRI
- Form 15CA/15CB and NRI Repatriation
- ITR Filing in Ghaziabad
Talk to a Chartered Accountant
If you are an NRI looking for professional assistance with ITR filing in India or want to claim a refund of excess TDS, contact us for detailed guidance. We work with NRIs completely online.
CA Mayank Agarwal (Chartered Accountants)
Raj Nagar Extension & Indirapuram, Ghaziabad
Phone / WhatsApp: 9718877122 | Email: fcamayankagarwal@gmail.com
This page gives general information for guidance only. Laws, forms, fees and timelines change from time to time and depend on individual facts, so please confirm the current position before acting. See all our service guides.