Tag: ITR filing

How to File ITR as NRI with Rental Income from India: Complete 2025-26 Guide
Do you own a house or flat in India that you’ve rented out while living abroad? As an NRI, rental income from Indian property is fully taxable in India — and the tenant is legally required to deduct TDS before paying you rent. Understanding how to handle this correctly can save you significant money and keep you compliant with Indian tax law.

At NRI Tax CA, we handle NRI rental income ITR filings every year. This comprehensive guide covers everything you need to know.

Is NRI Rental Income Taxable in India?

Yes, absolutely. Rental income from property situated in India is always taxable in India, regardless of your residential status. This applies whether you are NRI, RNOR, or full Resident. The property’s location — not your location — determines taxability.

TDS on NRI Rental Income: The Tenant’s Obligation

Here’s something many NRIs and their tenants don’t know: when a tenant pays rent to an NRI landlord, the tenant is legally required to deduct TDS at 30% (plus surcharge and cess) on the gross rent before paying. This is under Section 195 of the Income Tax Act.

Why does this matter? If your tenant doesn’t deduct TDS, both the tenant and you could face penalties. The tenant also cannot claim the rent as a business expense without TDS compliance.

The TDS rate for NRI rental income is typically 30% + 10% surcharge (if rent exceeds ₹50 lakh) + 4% health and education cess — making effective TDS up to 31.2% or higher on the gross rent.

Can the TDS Rate Be Reduced?

Yes — this is where significant planning opportunity exists. If your actual tax liability (after deductions) is lower than the TDS being deducted, you can apply for a Lower TDS Certificate under Section 197 (now filed via Form 128 / erstwhile Form 13). With this certificate, your tenant can deduct TDS at the lower rate specified by the Income Tax Department rather than the full 30%.

This is especially valuable when you have loan interest deductions, standard deduction, or other allowable expenses that reduce your taxable rental income significantly. Rather than waiting to claim a refund after filing ITR, get the Lower TDS Certificate upfront.

How Rental Income Is Computed for NRI ITR

Rental income falls under the head “Income from House Property” in your ITR. Here’s how it’s calculated:

Step 1: Gross Annual Value (GAV)

The Gross Annual Value is typically the actual rent received or receivable, whichever is higher. If the property was vacant for some months, only the rent for the let-out period counts.

Step 2: Deduct Municipal Taxes

Municipal taxes (property tax) paid to the local authority are deductible from GAV to arrive at Net Annual Value (NAV).

Step 3: Standard Deduction — 30%

You get a flat 30% deduction on NAV as “standard deduction” under Section 24(a). This covers repairs, maintenance, and all property expenses. No receipts needed — it’s automatic.

Step 4: Deduct Home Loan Interest (If Any)

If you have a home loan on the rented property, the entire interest paid is deductible under Section 24(b) — with no upper limit for let-out property (unlike self-occupied property which has a ₹2 lakh cap). This can dramatically reduce taxable rental income.

Taxable Income from House Property

= GAV − Municipal Taxes − 30% Standard Deduction − Home Loan Interest

This amount is added to your other India income (if any) and taxed at applicable slab rates.

Worked Example: NRI Rental Income Tax Calculation

Ananya lives in Dubai. She rents out her Mumbai flat for ₹40,000/month = ₹4,80,000/year.
- Gross Annual Value (GAV): ₹4,80,000
- Municipal taxes paid: ₹18,000
- Net Annual Value (NAV): ₹4,62,000
- Less 30% Standard Deduction: ₹1,38,600
- Less Home Loan Interest: ₹1,80,000
- Taxable House Property Income: ₹1,43,400
If this is Ananya’s only India income, it falls in the 5% slab. Her tax = ~₹7,170 — far less than the TDS of ₹1,49,760 (31.2% of ₹4,80,000) her tenant deducted. She should definitely file ITR to claim the refund.

Which ITR Form for NRI Rental Income?

NRIs with rental income from India must file ITR-2 (if no business income) or ITR-3 (if business income also present). ITR-1 (Sahaj) is not available to NRIs.

How to File NRI ITR with Rental Income: Step-by-Step
1. Register on Income Tax e-Filing Portal (incometax.gov.in) with your PAN
2. Link your PAN with Aadhaar (mandatory — may need OTP on Indian mobile)
3. Collect TDS certificates: Ask your tenant for Form 16C (TDS certificate for rent) or check Form 26AS/AIS on the portal for auto-populated TDS credits
4. Select ITR-2 and choose “Non-Resident” as residential status
5. Fill Schedule HP (House Property) with rental income details, deductions
6. Claim TDS credit from Form 26AS — this reduces your tax payable
7. Verify and submit — e-verify using OTP (Indian mobile) or EVC or net banking
Bank Account for Refund: Use NRO Account

If you’re due a TDS refund (which is common given 30% TDS vs lower actual tax), you need an Indian NRO bank account linked to your PAN on the tax portal. Refunds are credited to Indian bank accounts only. NRE accounts cannot receive tax refunds directly.

Reporting Rental Income in Your Country of Residence

India taxes your rental income at source. Your country of residence may also require you to report this income. However, most countries have DTAA (Double Tax Avoidance Agreements) with India — so you can claim the Indian tax paid as a credit in your foreign tax return, avoiding double taxation.

For example, if you live in the UK and paid ₹7,170 in India tax, you report the rental income in your UK Self-Assessment return but claim the India tax as a foreign tax credit, so you pay only the difference (if UK rate is higher).

Penalties for Non-Filing

NRIs often think that since TDS was deducted, they don’t need to file an ITR. This is incorrect. If your total India income (including rental income) exceeds the basic exemption limit (₹2.5 lakh under old regime or ₹3 lakh under new regime), you are required to file an ITR — even if TDS has been fully deducted.

Penalties for non-filing include: late filing fee up to ₹5,000, interest on unpaid tax under Sections 234A/234B/234C, and potential scrutiny/notices from the Income Tax Department.

Multiple Properties: Additional Rules

If you own more than two properties, only up to two can be considered “self-occupied” (if not rented). All others are deemed to have a rental income even if vacant — this is called Annual Letting Value (ALV). For NRIs who own multiple Indian properties but live abroad, all properties are typically treated as let-out and annual value must be computed for each.

Let NRI Tax CA Handle Your Rental Income ITR

Filing ITR with rental income involves multiple schedules, TDS credit matching, and sometimes claiming refunds. We’ve helped hundreds of NRIs across USA, UAE, UK, Canada, and Singapore file accurate ITRs and claim maximum refunds.

Our NRI ITR filing service starts at ₹3,499, with rental income included. We handle the full process — from collecting your TDS certificates to filing and e-verification support.

Estimate your NRI rental income tax and TDS refund with our free NRI tax calculator. Our CA team at Bilash Paul & Associates can file your ITR-2 with rental income — enquire now.

📞 WhatsApp us at +91 89309 63079 or use our contact form. Tell us your property rental amount and we’ll handle the rest.
April 25, 2026
How to Claim Foreign Tax Credit in India — Form 44 (Form 67) Guide for NRIs 2026
If you are an NRI who has returned to India and is now a resident, or if you are an RNOR earning income both in India and abroad, you may be paying tax in two countries on the same income. The solution is the Foreign Tax Credit (FTC) — a mechanism under India’s Double Tax Avoidance Agreements (DTAA) that allows you to offset taxes paid abroad against your Indian tax liability. Under the Income Tax Act 2025, this is claimed via Form 44 (previously Form 67).

Who Can Claim Foreign Tax Credit?

Foreign Tax Credit under Sections 90/91 of the Income Tax Act 2025 is available to:
- Resident Indians (ROR) who earn foreign income — salary, business income, capital gains, interest — that is also taxable in India
- RNOR (Resident but Not Ordinarily Resident) individuals in their transition years after returning from abroad
- Individuals from countries with which India has a DTAA — USA, UK, UAE, Canada, Australia, Singapore, Germany, and 90+ other countries
- Individuals from countries without DTAA who have paid tax there — FTC is available under Section 91 of the IT Act 2025 as unilateral relief
What Changed: Form 67 Is Now Form 44

Under the Income Tax Act 2025 (effective 1 April 2026), Form 67 has been renumbered as Form 44. The underlying process and purpose remain identical — you file a statement of foreign income and foreign taxes paid, and claim the credit against your Indian tax payable. If you search for “Form 67” online, it is the same as Form 44 under the new Act.

At NRI Tax CA, we handle Form 44 / Form 67 filing as an add-on to ITR filing at ₹1,499 (ITR filing starts at ₹3,499).

The Critical Deadline You Must Not Miss

This is the most common and costly mistake: Form 44 must be filed on or before the due date of your ITR. If you file your ITR first and then try to file Form 44 later, your FTC claim will be rejected. The Income Tax Department has been strict about this sequencing, and courts have consistently held that late Form 44 filings do not qualify for the credit.

For most individuals, the ITR due date is 31 July of the assessment year. For those with audit requirements, it is 31 October. File Form 44 before or on the same day as your ITR — not after.

What Information You Need to File Form 44

To file Form 44, you need the following documents from your foreign country of employment or residence:
- Foreign tax return or assessment order showing the income declared and tax assessed
- Proof of tax payment — tax paid certificate, withholding tax certificate, or bank statement showing tax deducted
- Nature of income — salary, capital gains, business income, interest, etc.
- DTAA Article under which the credit is being claimed
- Exchange rate on the date of tax payment for conversion to INR
You do not need to provide foreign documents to us directly — we will tell you exactly what to gather based on your specific country and income type.

How the Credit Is Calculated

The FTC you can claim is the lower of: (a) the foreign tax actually paid, or (b) the Indian tax payable on that same income. This prevents a situation where you claim more credit than your Indian tax liability on that income. The calculation is done income-category by income-category — foreign salary credit, foreign capital gains credit, etc. are computed separately.

For example: If you earned ₹10 lakhs in salary from your US employer and paid ₹2.5 lakhs in US federal tax on it, and your Indian tax on the same ₹10 lakhs is ₹1.8 lakhs — your FTC is limited to ₹1.8 lakhs (the lower amount). The excess US tax paid (₹70,000) is not refundable but may be carried forward under US tax rules.

Countries Where This Is Most Commonly Used

Foreign Tax Credit claims are most common for NRIs returning from the United States, United Kingdom, Canada, Australia, Germany, and Singapore. The US in particular has a global taxation system — meaning US citizens and green card holders pay US tax on worldwide income regardless of where they live. When such individuals also become Indian tax residents, Form 44 / Form 67 is essential to avoid double taxation.

NRI Status and RNOR — The Transition Window

When you return to India after being an NRI, you typically get a 2–3 year window as an RNOR (Resident but Not Ordinarily Resident). During RNOR status, your foreign income is not taxable in India — only Indian-sourced income is. This makes RNOR status extremely valuable, and careful planning of your return date can determine whether you get this benefit for 2 years or just 1.

Once RNOR status ends and you become a full Resident (ROR), your global income is taxable in India and FTC via Form 44 becomes essential if you still have foreign income. At NRI Tax CA, our NRI Status & Residential Advisory service (₹4,999) analyses your exact situation and advises on optimal transition timing.

Get Your Form 44 Filed Correctly

Foreign Tax Credit calculations involve DTAA interpretation, income-category matching, and precise timing requirements. An error here means either overpaying Indian tax (by not claiming enough credit) or a notice from the Income Tax Department (by claiming incorrectly). At NRI Tax CA, we handle Form 44 as part of your NRI ITR filing — ensuring the credit is maximised legally and filed on time.

Compute your foreign tax credit and net India tax liability with our free NRI tax calculator. For Form 67 filing and DTAA claim in ITR, consult our NRI tax experts.

Start your case here — fixed quote within 2 hours, ITR + Form 44 starting at ₹4,998.
April 25, 2026
NRI Tax in India 2026 — Complete Guide | Slabs, DTAA & ITR

If you are a Non-Resident Indian, understanding your tax obligations in India is not optional — it is essential. Many NRIs either overpay tax due to missed deductions, or unknowingly become non-compliant by not filing returns. This complete guide covers everything you need to know about NRI taxation in India for AY 2025-26.

Who is an NRI for Tax Purposes?

Your residential status under the Income Tax Act determines what income is taxable in India. An individual is treated as a Non-Resident Indian (NRI) for a financial year if they meet either of these conditions:

They were outside India for 182 days or more during that financial year, or they were outside India for 365 days or more during the four preceding financial years and stayed in India for less than 60 days in the current year.

This determination is made fresh every financial year. Your passport, visa status, or country of residence does not automatically make you an NRI — the day count is what matters under Indian tax law.

There is also a third status called Resident but Not Ordinarily Resident (RNOR), which applies to NRIs who have recently returned to India. RNOR status offers partial tax benefits for up to two years after return and requires careful planning.

What Income is Taxable in India for NRIs?

As an NRI, only income that accrues or arises in India, or is received in India, is taxable here. Your foreign income — salary earned abroad, bank interest in foreign accounts, rental income from foreign property — is not taxable in India at all.

Income that is taxable in India for NRIs includes:

Salary income — if the services are rendered in India, the salary is taxable in India regardless of where it is paid or received.

Rental income from Indian property — any property situated in India that generates rent is taxable in India. The fact that you receive the rent in a foreign account makes no difference.

Interest income from Indian bank accounts — interest earned on NRO accounts is fully taxable in India at applicable rates with TDS deducted at source. Interest on NRE and FCNR accounts is completely exempt from Indian tax.

Capital gains from Indian assets — profits from selling property, shares, mutual funds, or any other asset situated in India are taxable in India. The rates depend on whether the gain is short-term or long-term.

Business income from Indian operations — income from a business controlled or set up in India is taxable here.

TDS Rules for NRIs — Why You Often Overpay

Tax Deducted at Source works differently for NRIs compared to resident Indians. For most payments to NRIs, TDS is deducted at higher rates — often 30% plus surcharge and cess on gross income, without considering deductions or exemptions.

This means an NRI receiving rent of ₹10 lakh per year has TDS deducted at approximately ₹31,200 on the full amount, even though their actual tax liability after standard deduction and home loan interest may be zero or much lower.

The solution is a Lower TDS Certificate under Section 197. By applying on the income tax portal with a projection of your actual tax liability, you can get the TDS rate reduced to match your real obligation. This prevents large amounts from being locked with the Income Tax department for months while you wait for a refund.

Key TDS rates applicable to NRIs:

Interest on NRO accounts — 30% plus surcharge and cess. Rental income — 30% plus surcharge and cess under Section 195. Property sale proceeds paid to NRI seller — 20% on long-term gains or 30% on short-term gains, plus surcharge and cess, deducted by the buyer. Dividends — 20% plus surcharge and cess.

Which ITR Form Should NRIs File?

NRIs cannot file ITR-1 (Sahaj) under any circumstances. The correct forms are:

ITR-2 — for NRIs with income from salary, house property, capital gains, or other sources, but no business income. This is the most commonly used form for NRIs.

ITR-3 — for NRIs who have income from a proprietary business or profession in India in addition to other income.

ITR-2 requires careful attention to Schedule FA (Foreign Assets disclosure), Schedule FSI (Foreign Source Income), and Schedule TR (Tax Relief). These schedules are frequently missed, leading to defective return notices from the Income Tax department.

DTAA — How NRIs Avoid Double Taxation

India has Double Taxation Avoidance Agreements with over 90 countries including the USA, UK, UAE, Australia, Canada, Singapore, and Germany. These treaties ensure that NRIs are not taxed twice on the same income — once in India and again in their country of residence.

DTAA benefits work in two ways. Under the exemption method, income taxed in one country is exempt in the other. Under the tax credit method, the tax paid in one country is given as a credit against the tax liability in the other country.

To claim DTAA benefits in India, you need a Tax Residency Certificate (TRC) from your country of residence confirming that you are a tax resident there, and Form 10F filed on the Indian income tax portal. Without these documents, your bank or the Income Tax department will not extend DTAA benefits and full TDS will be deducted.

DTAA provisions can significantly reduce your tax outgo. For example, under the India-UAE DTAA, UAE residents pay no tax in UAE and can claim relief in India. Under India-USA DTAA, specific rates apply to dividends, interest, and royalties that are lower than domestic rates.

Capital Gains Tax for NRIs

Capital gains rules for NRIs largely mirror those for residents, but with important differences in TDS obligations and reinvestment options.

Property sale — Long-term capital gains (property held over 24 months) are taxed at 12.5% without indexation for sales after July 23, 2024 under the new regime, or 20% with indexation under the old regime for eligible cases. Short-term gains are taxed at slab rates.

Equity and mutual funds — Long-term capital gains on listed equity shares and equity mutual funds above ₹1.25 lakh are taxed at 12.5%. Short-term gains are taxed at 20%.

NRIs can claim capital gains exemptions under Sections 54, 54EC, and 54F by reinvesting proceeds into another residential property or specified bonds — subject to conditions and time limits.

NRO to Foreign Account — How Repatriation Works

One of the most common pain points for NRIs is moving money from their NRO account to their foreign bank account. The process is governed by FEMA and requires specific documentation.

NRIs can repatriate up to USD 1 million per financial year from their NRO account. The requirements are that all applicable taxes must have been paid on the funds, and Form 15CA and Form 15CB must be filed before the bank processes the outward remittance.

Form 15CB is a certificate issued by a practising Chartered Accountant confirming that taxes have been paid on the remittance amount and the applicable DTAA provisions have been considered. Form 15CA is then filed on the income tax portal using the details from Form 15CB.

Without these forms, your bank cannot legally process the international transfer. Many NRIs are unaware of this requirement and face delays or are forced to use informal channels unnecessarily.

Key Deadlines for NRIs — AY 2025-26

ITR filing deadline — 31st July 2025 for AY 2025-26 for NRIs without audit requirement. Belated return — can be filed up to 31st December 2025 with a late fee of ₹1,000 (if income below ₹5 lakh) or ₹5,000. Updated return (ITR-U) — can be filed within 2 years from the end of the relevant assessment year with additional tax payment. Lower TDS certificate application — should be filed well before income is received to avoid full TDS deduction.

Common Mistakes NRIs Make with Indian Taxes

Not filing ITR assuming TDS has covered all liability — TDS does not eliminate the filing obligation. Filing ITR-1 instead of ITR-2 — renders the return defective. Not disclosing foreign assets in Schedule FA — attracts penalties under Black Money Act. Missing DTAA benefit claims — results in excess tax payment. Not applying for Lower TDS Certificate — locks refundable amounts with the department for months. Not maintaining Form 26AS — leads to mismatches and notices. Treating NRE interest as taxable — NRE and FCNR interest is fully exempt. Not filing on return to India — RNOR status requires careful handling in the first two years after return.

How NRI Tax CA Can Help

We handle complete NRI tax compliance — ITR-2 and ITR-3 filing with DTAA analysis, Schedule FA and Schedule FSI, Form 15CA and 15CB for remittances, Lower TDS Certificate applications under Section 197, and NRI property sale advisory including capital gains computation and reinvestment planning.

Every case is handled personally by a Fellow Chartered Accountant. Fixed price quoted upfront. 24 to 48 hour turnaround. All communication in writing.

Email us at hello@nritaxca.com or visit nritaxca.com to submit your case today.

Get a quick estimate of your NRI tax liability with our free NRI tax calculator India 2026-27. For expert ITR filing, DTAA claims, or TDS compliance, submit an enquiry to our NRI tax team.

This article is for general information purposes only and does not constitute legal or tax advice. Please consult a qualified Chartered Accountant for advice specific to your situation.

Use our free NRI Tax Calculator to instantly estimate your property TDS, refund amount and ITR obligation → Calculate Now

April 9, 2026

NRI Rental Income Tax India 2026 — TDS, ITR & DTAA Guide

✅ Updated for Income Tax Act 2025. Effective April 1, 2026 — Form 15CA replaced by Form 145, Form 15CB replaced by Form 146.

NRI Rental Income Tax India 2026 — TDS, ITR & DTAA Guide

If you are an NRI with a property in India earning rental income, you are liable to pay Indian income tax on that rent — regardless of which country you live in. The tenant deducts TDS, the income must be declared in your ITR-2, and DTAA may reduce your total tax burden. Done correctly, this is straightforward. Done incorrectly, it results in excess TDS, missed refunds, and compliance notices.

This guide covers everything an NRI landlord needs to know: TDS rates, how to lower them, ITR-2 filing, DTAA treatment of rental income, and how to repatriate rent abroad.

Is Rental Income from India Taxable for NRIs?

Yes. Under the Income Tax Act, income earned from property situated in India is taxable in India regardless of the owner’s residential status. If you are an NRI and your Indian property earns rent, that rent is Indian-sourced income and is subject to Indian income tax.

The tax is computed as follows:

Gross Annual Value (actual rent received or receivable)
Minus: Municipal taxes paid by owner
Equals: Net Annual Value (NAV)
Minus: Standard deduction of 30% of NAV (automatic — no bills needed)
Minus: Interest on home loan (if applicable — no limit for let-out property)
Equals: Taxable rental income

TDS on Rent Paid to NRI — What the Tenant Must Do

When a resident Indian pays rent to an NRI landlord, they are legally required to deduct TDS under Section 195 of the Income Tax Act. This applies regardless of the rent amount — there is no threshold exemption for payments to NRIs.

TDS Rate	Applicable When
30% + surcharge + cess = 31.2%	Standard TDS rate under Section 195
As per DTAA rate	If NRI provides TRC + Form 10F before deduction
As per certificate	If NRI obtains Lower TDS Certificate (Form 13)

The standard TDS rate of 31.2% on rent is one of the highest applicable rates for NRI income. Most NRI landlords can legitimately reduce this through DTAA or a lower deduction certificate.

Tenant’s TDS Compliance Checklist

Deduct TDS on rent payment each month at 31.2% (or applicable DTAA rate)
Deposit TDS with the government by the 7th of the following month
File Form 27Q (TDS return for NRI payments) quarterly
Issue Form 16A to the NRI landlord within 15 days of filing 27Q

If the tenant does not deduct TDS, they become personally liable for the tax amount plus interest and penalty. This is a common source of disputes between NRI landlords and resident tenants.

How to Reduce TDS on NRI Rental Income

Option 1 — DTAA Benefit

Most DTAA treaties treat rental income (income from immovable property) as taxable in the country where the property is situated — which means India. The DTAA generally does not reduce the Indian tax rate on rental income, but it does eliminate double taxation by requiring your country of residence to give you credit for Indian taxes paid.

However, TDS at source can still be reduced if the NRI provides the tenant with a Tax Residency Certificate (TRC) and Form 10F. While the DTAA treaty rate on rent may match the domestic rate in some cases, the formal submission signals to the tenant that the NRI is a legitimate tax resident of a treaty country and can support a Lower TDS application.

Option 2 — Lower TDS Certificate (Form 13)

The most effective way to reduce TDS on rental income is to apply for a Lower or Nil TDS Certificate under Section 197. This is filed as Form 13 on the Income Tax portal by the NRI (or their CA).

The certificate specifies the exact TDS rate the tenant must apply — based on the NRI’s actual tax liability after deductions, exemptions, and DTAA credits. For a property with significant home loan interest, the actual taxable income after all deductions may be much lower than the gross rent, resulting in an effective tax rate far below 31.2%.

Application must be filed well in advance — processing takes 4–8 weeks
Certificate is valid for the financial year specified
Once issued, share with tenant — tenant deducts at the certified rate
Renew every financial year

DTAA Treatment of Rental Income — By Country

Country	DTAA Treatment of Indian Rental Income	Double Tax Eliminated?
🇦🇪 UAE	Taxable only in India (UAE has no personal income tax)	Yes — no UAE tax liability
🇺🇸 USA	India has primary right to tax; USA gives Foreign Tax Credit	Yes — credit mechanism prevents double tax
🇬🇧 UK	India has primary right to tax; UK gives credit for Indian tax	Yes — credit mechanism prevents double tax
🇦🇺 Australia	India has primary right to tax; Australia gives foreign tax offset	Yes — offset mechanism prevents double tax
🇨🇦 Canada	India has primary right to tax; Canada gives Foreign Tax Credit	Yes — credit mechanism prevents double tax
🇸🇬 Singapore	India has primary right to tax; Singapore exempts or credits	Yes — treaty provides relief

Unlike NRO interest where DTAA reduces the rate at source, rental income is typically taxable in India at full Indian rates under most treaties. The key benefit is that you are not taxed twice — your country of residence gives you credit for the Indian tax you pay.

How to File ITR-2 for NRI Rental Income

NRIs must use ITR-2 to declare Indian rental income. ITR-1 is not available for NRIs. The ITR-2 for FY 2025-26 must be filed by July 31, 2026.

Documents Required

Form 16A from tenant (shows TDS deducted and deposited)
Rent agreement and rent receipts
Municipal tax receipts (if paid by you)
Home loan interest certificate (if applicable)
Tax Residency Certificate (for DTAA claim)
Form 10F (if claiming DTAA benefit)
PAN card and Aadhaar (linked)

Key Schedules in ITR-2

Schedule HP — House Property income computation (gross rent, standard deduction, home loan interest)
Schedule TR — DTAA relief claimed (tax paid in India credited against foreign tax liability)
Schedule FA — Foreign assets disclosure (required if you hold foreign assets as well)
Schedule AL — Assets and liabilities (if total income exceeds ₹50 lakh)

Repatriating NRI Rental Income Abroad

Once rent is credited to your NRO account, you can repatriate up to USD 1 million per financial year under the RBI’s Liberalised Remittance Scheme (LRS) for NRIs. The process requires a CA certificate under the Income Tax Act 2025.

Repatriation Process Under the New Forms (From April 2026)

Form 145 (replaced Form 15CA) — Filed by the remitter (you) on the Income Tax portal. Declares the nature of remittance, amount, applicable DTAA provision, and TDS compliance.
Form 146 (replaced Form 15CB) — Certificate issued by a CA after examining the transaction. Certifies that applicable taxes have been paid or provided for, that the DTAA provision cited is correct, and that the remittance is compliant.

Form 146 requires your CA to analyse whether the rental income has been correctly assessed, whether TDS was deducted at the right rate, whether any DTAA relief has been properly applied, and whether the ITR for the relevant year has been filed. This cannot be automated — it requires professional judgment on the specific facts of your case.

Tax Computation Example — NRI in Australia with Rental Property

Item	Amount
Annual rent received	₹6,00,000
Municipal taxes paid	₹18,000
Net Annual Value	₹5,82,000
Standard deduction (30%)	₹1,74,600
Home loan interest	₹2,40,000
Taxable rental income	₹1,67,400
Tax at 30% slab	₹50,220
TDS deducted by tenant (31.2% of ₹6L)	₹1,87,200
TDS refund due	₹1,36,980

This example shows why filing ITR-2 is critical even when TDS has already been deducted — in many cases, the actual tax liability after deductions is significantly lower than the TDS already paid, resulting in a substantial refund.

Common Mistakes NRI Landlords Make

Not informing the tenant to deduct TDS — If TDS is not deducted, the tenant becomes a defaulter. More importantly, you cannot claim the TDS credit that was never deducted. Ensure the tenant is compliant from day one.
Not filing ITR-2 annually — Even if TDS covers all tax liability, ITR-2 must be filed to claim refunds, formally record DTAA claims, and avoid notices from the Income Tax Department.
Not claiming home loan interest deduction — For a let-out property, there is no cap on the home loan interest deduction. NRIs with home loans on rental properties often leave a significant deduction unclaimed.
Not applying for Lower TDS Certificate — The standard 31.2% TDS locks up significant cash for 12–18 months until refund. A Form 13 application costs a small CA fee and recovers lakhs upfront.
Assuming rent cannot be repatriated without a CA — Repatriation requires Form 145 + Form 146. Attempting to transfer without these documents is a compliance breach. Budget for this as part of your annual cost of holding Indian property.
Not disclosing rental income in the home country’s tax return — Most countries tax their residents on worldwide income. While DTAA prevents double tax via credit mechanisms, you are still required to disclose Indian rental income in your Australian, UK, US, or Canadian return. Failure to disclose is a separate compliance issue in your country of residence.

Frequently Asked Questions

My tenant is not deducting TDS. What do I do?

Your tenant is legally obligated to deduct TDS under Section 195. Remind them in writing. If they continue not to deduct, they face interest (1% per month) and penalty. As the landlord, you can still file ITR-2 declaring the gross rent and pay the tax yourself — but you cannot claim a TDS credit that was never deposited. It is in your interest to ensure the tenant complies.

I have multiple rental properties in India. Does each need separate compliance?

Each property is reported separately in Schedule HP of your ITR-2. TDS is deducted separately by each tenant. However, the DTAA claim, Form 10F, and Lower TDS Certificate apply to you as the NRI taxpayer — not per property. One CA can handle all properties in a single ITR-2 filing.

Can I claim deductions on a property that is vacant?

A vacant property can be treated as “deemed let out” under Section 23, where the annual value is estimated based on comparable market rents. Alternatively, if you can establish it was genuinely not let out, you may claim it as self-occupied — in which case no rental income is taxed but home loan interest deduction is also capped at ₹2 lakh. A CA should advise on the optimal treatment based on your specific circumstances.

My property is managed by a property management company. Who deducts TDS?

If the property management company collects rent and remits it to you, they are the payer and are responsible for TDS deduction under Section 195 if they know you are an NRI. If the company collects rent on your behalf and the final tenant is the payer, it depends on the arrangement. This should be clarified in your property management agreement — an incorrect TDS deduction setup creates compliance risk for both parties.

How do I repatriate my rental income to my bank account abroad?

Rental income received in your NRO account can be repatriated up to USD 1 million per year. The process: your CA prepares Form 146 after reviewing your ITR and TDS compliance. You then file Form 145 on the Income Tax portal. Both documents are submitted to your bank, which processes the international transfer. Do not attempt repatriation without these documents — banks are required to verify compliance before remitting.

Is the Standard Deduction of 30% available to NRIs?

Yes. The 30% standard deduction on Net Annual Value is available to all property owners, including NRIs. It is automatic — no bills, no proof of repairs or maintenance is required. It covers all repairs, maintenance, and property management expenses as a flat deduction.

How We Handle NRI Rental Income at NRI Tax CA

Our rental income service for NRIs covers the complete compliance cycle — not just ITR filing. We advise on Lower TDS Certificate applications, ensure DTAA is correctly applied, file ITR-2 with all deductions claimed, and prepare Form 145 and Form 146 for repatriation. Our fee is fixed. There are no hidden charges based on refund amount or property value.

Service	Price
NRI ITR-2 — Rental income (single property)	Starting ₹3,999
NRI ITR-2 — Multiple properties + DTAA	Starting ₹5,999
Lower TDS Certificate (Form 13) application	Starting ₹2,999
Form 145 + 146 for rental income repatriation	Starting ₹5,999

Have rental income in India and unsure if your compliance is correct?
Email hello@nritaxca.com — we’ll review your situation at no charge and tell you exactly what’s needed.

Calculate your NRI rental income tax and TDS liability with our free NRI tax calculator. Need help filing ITR or Form 15CA/15CB? Talk to our CA team at Bilash Paul & Associates.

Updated April 2026. Reflects Income Tax Act 2025 — Form 145 (replaces Form 15CA) and Form 146 (replaces Form 15CB) effective April 1, 2026.

March 21, 2026

NRI ITR-2 Filing Guide 2026 — How to File Income Tax in India

📅 ITR Filing Deadline: July 31, 2026 for FY 2025-26 (AY 2026-27). Only 75 days remaining. Secure your CA slot →

NRI ITR-2 Filing Guide 2026 — Complete Step-by-Step for FY 2025-26

If you are a Non-Resident Indian (NRI) with income from India — rental income, interest on NRO accounts, capital gains from property or shares, or any other Indian source — you are required to file an Income Tax Return in India for FY 2025-26 (Assessment Year 2026-27). The deadline is July 31, 2026.

This guide covers everything you need to know — which ITR form to use, what income to declare, how to claim DTAA benefits, and how to avoid the most common mistakes NRIs make when filing.

Who Must File ITR as an NRI in 2026?

As an NRI, you must file an Indian Income Tax Return if any of the following apply:

Your total income from Indian sources exceeds ₹2.5 lakh (old regime) or ₹4 lakh (new regime) in FY 2025-26
You have capital gains from sale of property or shares in India — regardless of amount
TDS has been deducted on your Indian income and you want to claim a refund
You have income from a business or profession in India
You hold foreign assets or have signing authority on foreign accounts (Schedule FA disclosure)
You want to carry forward capital losses to offset against future gains

Even if your Indian income is below the exemption limit, filing an ITR is the only way to claim a refund of TDS that has been deducted at source — for example, 30% TDS on NRO account interest.

Which ITR Form Do NRIs Use?

ITR Form	When to Use	NRI Applicable?
ITR-1 (Sahaj)	Salary + one house property + other income	NO — NRIs cannot use ITR-1
ITR-2	Salary, house property, capital gains, foreign income/assets	YES — Most NRIs use this
ITR-3	Business or professional income in India	YES — if NRI has Indian business income
ITR-4 (Sugam)	Presumptive income from business	NO — NRIs cannot use ITR-4

The answer for most NRIs is ITR-2. Use ITR-3 only if you run a business or practice in India. Never use ITR-1 or ITR-4 as an NRI — your return will be defective.

What Income Do NRIs Declare in ITR-2?

Taxable Indian Income for NRIs

Income Type	Taxability	TDS Rate
NRO account interest	Fully taxable at slab rates	30% + surcharge + cess
NRE account interest	Fully EXEMPT	No TDS
FCNR account interest	Fully EXEMPT	No TDS
Rental income from Indian property	Taxable after 30% standard deduction	30% by tenant (Section 195)
Long term capital gains — property	12.5% (post July 2024 purchases, no indexation)	12.5% on sale value
Short term capital gains — property	Taxable at slab rates	30% on sale value
Long term capital gains — listed shares	12.5% above ₹1.25 lakh	Broker deducts
Short term capital gains — listed shares	20% (STT paid transactions)	Broker deducts
Dividends from Indian companies	Taxable at slab rates	20% TDS
Foreign salary / income	NOT taxable in India for NRIs	No TDS

How to Determine Your Residential Status for FY 2025-26

Your residential status determines what income is taxable in India. An individual is treated as an NRI for FY 2025-26 if they spent fewer than 182 days in India during the financial year (April 1, 2025 to March 31, 2026).

There is an important exception: Indian citizens whose total Indian income (excluding foreign income) exceeds ₹15 lakh are treated as “deemed residents” even if they spent fewer than 182 days in India — provided they are not taxable in any other country. This primarily affects people living in zero-tax countries like UAE.

Three Residential Categories

Status	Condition	What is taxable in India
NRI	Less than 182 days in India	Only Indian-source income
RNOR	Transitioning from NRI to resident	Indian income + certain foreign income
Resident (ROR)	182+ days in India	Global income — including foreign salary

Important: Count your days carefully using passport stamps and airline records. Even a small error can change your tax status and significantly increase your tax liability.

Step-by-Step — How to File ITR-2 as an NRI for FY 2025-26

Step 1 — Gather All Required Documents

PAN card
Aadhaar number (must be linked to PAN)
Form 26AS / AIS / TIS from the Income Tax portal — shows all TDS deducted against your PAN
Bank statements for all NRO accounts
Form 16A from banks (TDS certificate for NRO interest)
Rental income details — rent receipts, municipal tax paid
Sale deed and purchase deed if property was sold during the year
Broker contract notes for share transactions
Tax Residency Certificate (TRC) from your country of residence — for DTAA claims
Form 10F — filed electronically on the Income Tax portal

Step 2 — Download and Reconcile Form 26AS

Log into the Income Tax portal at incometax.gov.in → My Account → Form 26AS. This document shows every TDS deduction against your PAN. Your ITR must match Form 26AS exactly — any mismatch triggers a notice.

Also check AIS (Annual Information Statement) which shows all financial transactions reported against your PAN including property purchases, large bank credits, and share transactions.

Step 3 — Choose Between Old and New Tax Regime

Feature	Old Regime	New Regime (Default)
Basic exemption	₹2.5 lakh	₹4 lakh
Section 80C deductions	Available (up to ₹1.5 lakh)	Not available
Home loan interest (Section 24)	Available	Limited
Tax rates	Higher slabs	Lower slabs
Best for NRIs when	High deductions available	Simple income, few deductions

Note for NRIs: The tax rebate under Section 87A is NOT available to NRIs. Only resident individuals can claim this rebate. This is one of the most common errors in NRI returns.

Step 4 — Claim DTAA Benefits (Critical Step)

If your country of residence has a Double Taxation Avoidance Agreement (DTAA) with India, you may be entitled to a lower TDS rate or a foreign tax credit. To claim DTAA benefits you must:

Obtain a Tax Residency Certificate (TRC) from your country’s tax authority
File Form 10F electronically on the Income Tax portal
Submit both documents to the payer (bank, tenant, company) before income is paid
Declare DTAA benefit in Schedule TR of your ITR-2

DTAA benefit by country for NRO interest:

Country	Standard TDS	DTAA Rate on Interest	Saving
🇦🇪 UAE	30%	12.5%	17.5% saving
🇺🇸 USA	30%	15%	15% saving
🇬🇧 UK	30%	15%	15% saving
🇦🇺 Australia	30%	15%	15% saving
🇨🇦 Canada	30%	15%	15% saving
🇸🇬 Singapore	30%	15%	15% saving

Step 5 — Fill Schedule FA (Foreign Assets Disclosure)

NRIs filing ITR-2 whose total Indian assets exceed ₹1 crore must disclose foreign assets in Schedule FA. This includes:

Foreign bank accounts
Foreign property and real estate
Foreign equity and debt interests
Foreign trusts and beneficiary interests
Any other foreign financial interest

Penalty for non-disclosure: ₹10 lakh per year under the Black Money Act. This is one of the most serious compliance requirements for NRIs.

Step 6 — File ITR-2 on the Income Tax Portal

Log in to incometax.gov.in
Go to e-File → Income Tax Returns → File Income Tax Return
Select Assessment Year 2026-27
Select ITR-2
Choose filing mode — online (recommended) or offline (download utility)
Fill in all schedules — Schedule HP (house property), Schedule CG (capital gains), Schedule OS (other sources), Schedule TR (DTAA relief), Schedule FA (foreign assets)
Compute tax and verify the amount matches your expectation
Submit and e-verify within 30 days

Step 7 — E-Verify the Return

Filing the ITR is not complete until you e-verify it. An unverified ITR is treated as if it was never filed. E-verification options:

Aadhaar OTP (fastest — instant verification)
Net banking (login to your bank → e-verify)
Bank account EVC (electronic verification code)
DSC (Digital Signature Certificate)

E-verify within 30 days of filing. Missing this deadline means the return is invalid and you must refile.

Key Deadlines for FY 2025-26 (AY 2026-27)

Event	Deadline
Regular ITR filing deadline	July 31, 2026
Belated ITR (with penalty)	December 31, 2026
Updated ITR (ITR-U) with additional tax	Up to 2 years from end of assessment year
E-verification after filing	Within 30 days of filing

Penalties for Late Filing

Income level	Late filing penalty
Total income up to ₹5 lakh	₹1,000
Total income above ₹5 lakh	₹5,000
Interest on tax due (Section 234A)	1% per month on tax payable

Most Common NRI ITR-2 Mistakes

Mistake 1 — Using ITR-1 instead of ITR-2
NRIs cannot use ITR-1. If you file ITR-1 as an NRI, the return is defective and you will receive a notice. Always use ITR-2.

Mistake 2 — Not declaring NRO account interest
Many NRIs believe NRO interest is “already taxed via TDS so no need to declare.” This is wrong. You must declare the income in your ITR — TDS is just advance tax. The return is how you reconcile actual liability vs TDS paid.

Mistake 3 — Claiming Section 87A rebate
NRIs are NOT eligible for the Section 87A rebate of up to ₹12,500 (old regime) or ₹60,000 (new regime for income up to ₹12 lakh). Claiming this incorrectly will generate a demand notice.

Mistake 4 — Not filing Form 10F before DTAA claim
You cannot claim DTAA benefit in your ITR without having first filed Form 10F electronically. Retrospective filing is not accepted. File Form 10F at the start of every financial year.

Mistake 5 — Wrong residential status
Declaring yourself as “Resident” when you are an NRI means your foreign income becomes taxable in India. Always determine residential status before filing and count days precisely.

Mistake 6 — Not reconciling with Form 26AS before filing
If your declared income does not match Form 26AS, the Income Tax Department’s system automatically generates a mismatch notice. Always download and reconcile Form 26AS before filing.

Mistake 7 — Not e-verifying within 30 days
A filed but unverified ITR is treated as invalid. The deadline for e-verification is 30 days from the date of filing. Many NRIs forget this step.

Mistake 8 — Missing Schedule FA disclosure
If you have foreign assets — bank accounts, property, investments — and do not disclose them in Schedule FA, the penalty is ₹10 lakh per year under the Black Money Act.

Frequently Asked Questions — NRI ITR-2 Filing 2026

Q: I am an NRI in UAE. Is my salary taxable in India?
No. Salary earned for services performed outside India is not taxable in India for an NRI. Only income sourced from India — like NRO interest, rental income, or capital gains on Indian property — is taxable.

Q: I have only NRO account interest income of ₹1.8 lakh. Do I need to file ITR?
If your income is below ₹2.5 lakh (old regime) or ₹4 lakh (new regime), you are not required to file. However, if TDS has been deducted at 30%, filing an ITR is the only way to claim a refund — which you should.

Q: Can I file ITR-2 from outside India?
Yes. ITR-2 is filed online on the Income Tax portal from anywhere in the world. You need your PAN, Aadhaar-linked mobile for OTP verification, and internet access.

Q: What if I missed the July 31 deadline?
You can file a belated return up to December 31, 2026 with a penalty of ₹1,000 (income up to ₹5 lakh) or ₹5,000 (income above ₹5 lakh). However you lose the ability to carry forward losses.

Q: My tenant deducted 30% TDS on rent but my actual tax slab is 20%. Can I get a refund?
Yes. File ITR-2 declaring the rental income, compute actual tax at 20%, and claim the excess TDS as a refund. Refunds are typically processed within 3-6 months of filing.

Q: I sold property in India this year. Which schedule in ITR-2 do I fill?
Declare the capital gain in Schedule CG (Capital Gains). For long-term gains, show the purchase price, indexed cost (for pre-July 2024 purchases), and any Section 54 or 54EC exemptions claimed.

Q: Do I need to show my NRE account balance in ITR-2?
NRE account interest is exempt and does not need to be declared as income. However, if your total Indian assets exceed ₹1 crore, you may need to disclose the account in Schedule FA.

Q: What documents does my CA need to file my ITR-2?
Form 26AS / AIS, bank statements for NRO accounts, Form 16A from banks, rental income details, property sale documents (if applicable), share transaction contract notes, TRC and Form 10F for DTAA claims, and passport copy for residential status verification.

Q: Can I revise my ITR-2 after filing if I made a mistake?
Yes. A revised return can be filed up to December 31, 2026 for FY 2025-26. There is no penalty for filing a revised return before this deadline.

Q: Is it compulsory to link Aadhaar with PAN for NRI ITR filing?
PAN-Aadhaar linking is mandatory for resident Indians. NRIs who do not have an Aadhaar number may request exemption by updating their NRI status on the Income Tax portal.

NRI ITR-2 Filing — What We Handle

Our team handles complete ITR-2 filing for NRIs — residential status determination, income computation, DTAA analysis, Schedule FA disclosure, Form 10F filing, and e-verification. Every return is reviewed by an ICAI-registered Fellow Chartered Accountant.

✓ All NRI income types — NRO interest, rental income, capital gains, dividends
✓ DTAA benefit claims for USA, UK, UAE, Australia, Canada, Singapore
✓ Foreign tax credit computation
✓ Schedule FA disclosure for foreign assets
✓ Complete reconciliation with Form 26AS / AIS before filing
✓ E-filing and e-verification included
✓ Written confirmation of every step

Service	Price
NRI ITR-2 — Basic (interest + rental income)	Starting ₹3,499
NRI ITR-2 — With capital gains	Starting ₹4,999
NRI ITR-2 — With property sale + repatriation	Starting ₹6,999
Form 145 + 146 + ITR-2 complete package	Starting ₹6,999

ITR deadline: July 31, 2026 — 75 days remaining
Email us at hello@nritaxca.com — fixed quote within 2 hours.
Start Your ITR Filing →

This guide is updated as of April 2026 and reflects provisions of the Income Tax Act 2025 applicable for FY 2025-26 (AY 2026-27). Consult a qualified Chartered Accountant for advice specific to your situation.

Focus keyphrase: NRI income tax return India

Before filing ITR-2, use our free NRI tax calculator to estimate your tax liability, TDS credit and refund amount. Our CA team can file your ITR-2 — get started here.

Use our free NRI Tax Calculator to instantly estimate your property TDS, refund amount and ITR obligation → Calculate Now

March 17, 2026

Tag: ITR filing

How to File ITR as NRI with Rental Income from India: Complete 2025-26 Guide

Is NRI Rental Income Taxable in India?

TDS on NRI Rental Income: The Tenant’s Obligation

Can the TDS Rate Be Reduced?

How Rental Income Is Computed for NRI ITR

Step 1: Gross Annual Value (GAV)

Step 2: Deduct Municipal Taxes

Step 3: Standard Deduction — 30%

Step 4: Deduct Home Loan Interest (If Any)

Taxable Income from House Property

Worked Example: NRI Rental Income Tax Calculation

Which ITR Form for NRI Rental Income?

How to File NRI ITR with Rental Income: Step-by-Step

Bank Account for Refund: Use NRO Account

Reporting Rental Income in Your Country of Residence

Penalties for Non-Filing

Multiple Properties: Additional Rules

Let NRI Tax CA Handle Your Rental Income ITR

How to Claim Foreign Tax Credit in India — Form 44 (Form 67) Guide for NRIs 2026

Who Can Claim Foreign Tax Credit?

What Changed: Form 67 Is Now Form 44

The Critical Deadline You Must Not Miss

What Information You Need to File Form 44

How the Credit Is Calculated

Countries Where This Is Most Commonly Used

NRI Status and RNOR — The Transition Window

Get Your Form 44 Filed Correctly

NRI Tax in India 2026 — Complete Guide | Slabs, DTAA & ITR

Who is an NRI for Tax Purposes?

What Income is Taxable in India for NRIs?

TDS Rules for NRIs — Why You Often Overpay

Which ITR Form Should NRIs File?

DTAA — How NRIs Avoid Double Taxation

Capital Gains Tax for NRIs

NRO to Foreign Account — How Repatriation Works

Key Deadlines for NRIs — AY 2025-26

Common Mistakes NRIs Make with Indian Taxes

How NRI Tax CA Can Help

NRI Rental Income Tax India 2026 — TDS, ITR & DTAA Guide

NRI Rental Income Tax India 2026 — TDS, ITR & DTAA Guide

Is Rental Income from India Taxable for NRIs?

TDS on Rent Paid to NRI — What the Tenant Must Do

Tenant’s TDS Compliance Checklist

How to Reduce TDS on NRI Rental Income

Option 1 — DTAA Benefit

Option 2 — Lower TDS Certificate (Form 13)

DTAA Treatment of Rental Income — By Country

How to File ITR-2 for NRI Rental Income

Documents Required

Key Schedules in ITR-2

Repatriating NRI Rental Income Abroad

Repatriation Process Under the New Forms (From April 2026)

Tax Computation Example — NRI in Australia with Rental Property

Common Mistakes NRI Landlords Make

Frequently Asked Questions

My tenant is not deducting TDS. What do I do?

I have multiple rental properties in India. Does each need separate compliance?

Can I claim deductions on a property that is vacant?

My property is managed by a property management company. Who deducts TDS?

How do I repatriate my rental income to my bank account abroad?

Is the Standard Deduction of 30% available to NRIs?

How We Handle NRI Rental Income at NRI Tax CA

NRI ITR-2 Filing Guide 2026 — How to File Income Tax in India

NRI ITR-2 Filing Guide 2026 — Complete Step-by-Step for FY 2025-26

Who Must File ITR as an NRI in 2026?

Which ITR Form Do NRIs Use?

What Income Do NRIs Declare in ITR-2?

Taxable Indian Income for NRIs

How to Determine Your Residential Status for FY 2025-26

Three Residential Categories

Step-by-Step — How to File ITR-2 as an NRI for FY 2025-26

Step 1 — Gather All Required Documents

Step 2 — Download and Reconcile Form 26AS

Step 3 — Choose Between Old and New Tax Regime

Step 4 — Claim DTAA Benefits (Critical Step)

Step 5 — Fill Schedule FA (Foreign Assets Disclosure)

Step 6 — File ITR-2 on the Income Tax Portal

Step 7 — E-Verify the Return

Key Deadlines for FY 2025-26 (AY 2026-27)