The question that comes up most often among UK-resident Indians is deceptively simple: do I need to tell HMRC about my Indian bank account? The answer, for most UK tax residents, is yes.

UK tax residents are generally taxed on worldwide income and gains, subject to the remittance basis rules that used to apply to non-domiciled individuals (a regime that has changed significantly with reforms effective from April 2025, replacing the old non-dom remittance basis with a new residence-based system). Indian NRE and NRO fixed deposit interest, mutual fund income, dividends, and rental income from Indian property all typically need to be reported on the UK self-assessment return, converted into pounds sterling using appropriate exchange rates for the relevant dates.

The India-UK Double Taxation Avoidance Agreement provides relief so the same income isn’t taxed twice, but claiming that relief means having clean documentation from the Indian side: TDS certificates, Form 26AS, capital gains statements on any shares or property sold. Property sales in particular need careful handling, since India taxes capital gains on sale by non-residents with its own TDS mechanism, and the UK will want the gain reported under its own capital gains tax rules, with foreign tax credit claimed against what was already withheld in India.

One detail that catches people out is the UK tax year itself, running from 6 April to 5 April, which rarely aligns with India’s April-to-March financial year. That mismatch means income sometimes needs to be apportioned across two Indian financial years to map onto a single UK tax year correctly.

What generally saves the most stress is treating Indian financial records as something to organise continuously, not something to assemble the week a filing deadline looms. Ashutosh Financial Services has seen how much smoother the process becomes when NRIs bring consolidated Indian statements to their UK accountant well in advance. Ashutosh Financial Services runs periodic sessions for the UK NRI community on staying compliant across both tax jurisdictions.

Australia’s tax year runs from 1 July to 30 June, which already puts Indian-origin residents on a different clock than the one they grew up with. Add in the fact that Australian tax residents are assessed on worldwide income, and Indian bank interest, dividends, and capital gains all need to show up on the Australian return too.

The Australian Taxation Office treats foreign income the way most developed-country tax authorities do: it wants it declared in Australian dollars, converted using an appropriate exchange rate, for the relevant Australian income year. NRE and NRO fixed deposit interest, mutual fund distributions, and gains from selling Indian property or shares all fall under this. The India-Australia Double Taxation Avoidance Agreement generally allows a credit for tax already paid in India, but claiming it correctly requires matching Indian TDS certificates and capital gains computations to the Australian financial year, which rarely lines up neatly with India’s April-to-March year.

Capital gains on Indian property deserve particular attention. India applies its own capital gains tax and TDS rules on property sales by non-residents, and Australia will separately want the gain reported and taxed at Australian rates, with foreign tax credit relief for what was already paid in India. Getting the cost base, holding period, and currency conversion right on both sides takes some care, and errors tend to surface only when the ATO cross-checks foreign income data years later.

The organisational work is mostly about timing and documentation: Indian tax certificates, Form 26AS, capital gains statements, and TDS proofs need to be readily available, and ideally translated into a format an Australian accountant can actually use.

Ashutosh Financial Services works with NRI families across Australia who find that reconciling two financial years and two currencies is the hardest part of this exercise, not the tax rates themselves. Ashutosh Financial Services continues to hold educational sessions on Indian-Australian cross-border tax matters for NRIs looking to stay compliant on both sides.

The Property That Sat Empty for Four Years Because No One Had Power of Attorney

An NRI in Dubai inherits a flat in Ahmedabad, sells nothing, changes nothing, and by the time it needs attention, four years have passed and the paperwork trail has gone cold. This isn’t a rare story. It’s what happens by default when Indian assets are left unattended from abroad, not because of neglect, but because distance quietly makes even routine tasks difficult.

A registered Power of Attorney is usually the first gap that shows up. Without one, an NRI has to be physically present in India for property transactions, bank formalities, or even simple maintenance decisions, which isn’t realistic for someone visiting once a year. A properly drafted and registered PoA, given to someone genuinely trustworthy, turns a task requiring a flight into one that can be handled over a phone call. It needs to be specific about what powers it grants, not a vague blanket document that either does too little or invites misuse.

Property records need periodic checking even when nothing is being bought or sold. Encroachment, unauthorised occupation, and disputed mutation entries tend to surface exactly when a property has gone unvisited for years, and by the time an NRI notices, the fix is far more expensive than the prevention would have been. Advisors at Ashutosh Financial Services generally recommend an annual title and physical status check for any Indian property held from abroad, regardless of whether it’s occupied or vacant.

Nomination and joint holding on bank accounts, demat accounts, and mutual fund folios matter more for NRIs than for resident investors, simply because the practical difficulty of establishing legal heirship from another country is significantly higher. An asset without a nominee doesn’t disappear, but it becomes considerably harder to access for whoever is entitled to it later. Ashutosh Financial Services routinely flags missing nominations as one of the most fixable gaps in NRI portfolios, precisely because fixing it takes minutes and ignoring it costs months.

None of this requires constant attention from abroad. It requires a system that doesn’t depend on physical presence to function. Ashutosh Financial Services continues to help NRI families set up exactly this kind of oversight through its ongoing advisory and awareness initiatives.

What NRIs Can Actually Invest In, and What Gets Overcomplicated

The list of investment options available to NRIs in India looks long on paper, but most of it collapses into a handful of genuinely relevant categories once the noise is cleared away. The trick isn’t finding more options. It’s figuring out which ones actually fit a particular NRI’s situation.

Mutual funds remain the most straightforward entry point, since most Indian fund houses accept NRI investments from the majority of countries, with a smaller list of countries, notably the US and Canada, requiring additional compliance from the fund house due to their domestic securities regulations. This is why some funds simply don’t accept applications from certain jurisdictions rather than dealing with the paperwork, which catches people off guard when a fund they wanted turns out to be unavailable to them.

Direct equity investment works differently. NRIs trading in Indian shares generally do so under a specific RBI-regulated route, distinct from how resident investors operate, and it requires a designated bank account and demat setup before the first trade happens. Skipping this step and trying to route investments through a regular resident account is a compliance issue waiting to surface, not a shortcut.

The National Pension System is open to NRIs and offers a disciplined, tax-advantaged way to build a retirement corpus in India, though the tax treatment on withdrawal for someone no longer resident in India needs checking against their country of residence’s own rules, not just India’s. Advisors at Ashutosh Financial Services routinely flag this as the part people forget to check until withdrawal is already underway.

On the insurance side, life insurance from an Indian insurer is available to NRIs, but premium payment currency, claim settlement process, and repatriation of maturity proceeds all vary by insurer and need confirming upfront, not assumed. Health insurance works similarly, and NRIs keeping an Indian policy as backup cover should check whether it actually pays out for treatment taken while they’re abroad, since many don’t. Ashutosh Financial Services generally recommends verifying this specific clause before treating a policy as global protection.

None of these options are complicated individually. They just don’t work well when chosen off a generic list without checking fit against residency, country of residence, and purpose. Ashutosh Financial Services continues to run its investor sessions around exactly this kind of matching exercise for NRIs weighing where to put their money.

The Five Minutes That Save an NRI a Compliance Headache Later

An NRI opening a regular resident savings account instead of an NRO or NRE account, because a bank branch didn’t ask and nobody flagged it, is a more common story than it should be. That single account choice sits at the intersection of at least two different regulatory frameworks, and getting it wrong quietly creates problems that surface years later, usually when it’s least convenient to fix.

Banking and investment activity for NRIs falls under FEMA, the Foreign Exchange Management Act. It sets out which accounts are permitted, NRE for foreign earnings, NRO for India-sourced income, FCNR for foreign currency deposits, and governs repatriation limits and property transactions. Under FEMA, NRIs can buy residential or commercial property in India without restriction, but agricultural land and plantation property are off-limits unless acquired through inheritance.

Tax residency is decided separately under the Income Tax Act, using a day-count test based on time spent in India, not by FEMA’s definition of NRI status. A person can remain an NRI for banking purposes while becoming tax-resident in a particular year purely because of an extended stay, which changes what income becomes taxable in India for that year. Advisors at Ashutosh Financial Services see this gap between FEMA status and tax status catch people off guard fairly often.

Where India has signed a Double Taxation Avoidance Agreement with the country of residence, that treaty decides which country taxes what first and how credit is claimed for tax paid elsewhere. It doesn’t replace either country’s domestic law; it just coordinates between them, and using it requires documentation like a Tax Residency Certificate, not just an assumption that the treaty applies automatically.

Investing in Indian shares or mutual funds brings in a fourth layer, SEBI’s framework for NRI participation in securities markets, which runs on its own reporting route distinct from resident investors. Ashutosh Financial Services generally walks new NRI clients through all four frameworks together at the outset, since addressing one in isolation tends to leave gaps that only become visible later.

These frameworks weren’t built to align neatly with each other, which is precisely why overlaps and gaps show up so often. Ashutosh Financial Services continues to run structured sessions unpacking this exact overlap for NRIs before it becomes a compliance issue.

Filing a US or Canadian tax return as an NRI means reporting worldwide income, and that includes whatever is sitting in Indian bank accounts, fixed deposits, mutual funds, and rental property. Most people underestimate how much documentation this actually requires until the filing season is already underway.

The US taxes citizens and green card holders on global income regardless of where they live, and the FBAR and FATCA (Form 8938) reporting thresholds catch many NRIs by surprise, since even modest NRE or NRO balances can trigger a filing requirement once aggregate foreign account values cross the limit. Canada works differently in mechanics but the same in principle: residents must report worldwide income, and the T1135 foreign income verification statement applies once foreign property crosses a set threshold.

The practical headache is translating Indian financial documents into a format that fits US or Canadian tax software and rules. Indian mutual funds, for instance, are often treated as passive foreign investment companies (PFICs) under US tax law, which carries a punitive and complex reporting regime unless elections are made correctly and on time. Fixed deposit interest, dividend income, and capital gains from property sales all need to be converted, reported, and reconciled with the India-US or India-Canada tax treaty to claim credit and avoid double taxation.

None of this is optional paperwork. Getting PFIC treatment wrong, missing an FBAR deadline, or misreporting a property sale can lead to penalties that dwarf the tax actually owed. What helps most NRIs is having consolidated, accurate statements from their Indian accounts and investments well before their US or Canadian preparer needs them, rather than scrambling to reconstruct a year’s worth of transactions in March or April.

Ashutosh Financial Services has observed that NRIs who keep their Indian financial records organised through the year tend to have far smoother overseas filing seasons than those who treat it as an annual scramble. Ashutosh Financial Services continues to run educational sessions to help NRIs understand how their Indian finances intersect with foreign tax obligations, well ahead of filing deadlines.

Picture two NRIs with identical Indian portfolios of Rs 50 lakh each. One puts it all into an NRE fixed deposit and watches it grow at a steady, predictable rate, fully repatriable and tax-free in India. The other puts it all into equity mutual funds, chasing higher long-term returns but riding out every market correction along the way. Neither approach, on its own, is really doing the whole job.

NRE fixed deposits offer something equity can’t: capital certainty, full repatriability of both principal and interest, and interest that is exempt from Indian income tax for as long as the depositor holds NRI status. That makes them a natural home for money that has a purpose within the next few years, or for the part of a portfolio that simply needs to not lose value.

Equity mutual funds do the opposite job well. Over long holding periods, Indian equities have historically outpaced fixed-income returns by a meaningful margin, and mutual funds give NRIs a regulated, professionally managed way to participate in that growth without picking individual stocks. The trade-off is volatility that FDs simply don’t have, and gains are subject to capital gains tax depending on the holding period and fund category.

Blending the two isn’t a compromise so much as a division of labour. The FD portion anchors the portfolio and covers near-term needs or risk-averse capital, while the equity portion is left alone to compound over years, ideally through market cycles rather than around them. The right split between the two depends entirely on the individual’s time horizon, repatriation needs, and appetite for seeing account values move.

Ashutosh Financial Services frequently helps NRIs think through this balance rather than defaulting to whichever option feels more familiar. Ashutosh Financial Services’ ongoing investor awareness programmes cover exactly this kind of asset allocation thinking for the NRI community.

No. NRIs are not required to link their Aadhaar with their PAN, and this is one of the more persistently misunderstood rules in the NRI financial world.

The Aadhaar-PAN linking requirement, and the penalty for not complying, applies to individuals who are eligible to obtain an Aadhaar number under the Aadhaar Act, which in practice means residents of India. NRIs, by definition, do not meet the residency threshold that makes Aadhaar enrolment mandatory for them, and the Central Board of Direct Taxes has clarified that NRIs are exempt from the linking requirement, provided their NRI status is correctly reflected in the Income Tax Department’s records.

The catch is in that last clause. If an NRI’s PAN database still shows them as a resident, either because they never updated their status after moving abroad or because their PAN was originally issued when they lived in India, the system may still flag the PAN as inoperative for non-linking, even though the exemption technically applies. This has genuinely happened to NRIs who assumed the exemption was automatic.

The fix is proactive, not reactive. NRIs should ensure their residential status is updated correctly with the Income Tax Department, generally by filing tax returns with NRI status declared or through the appropriate application process, so their PAN reflects their actual position. An inoperative PAN isn’t a minor inconvenience either; it can affect TDS rates on Indian income, block certain banking transactions, and complicate mutual fund and demat account operations.

Anyone who has moved from resident to NRI status and hasn’t touched their PAN records since is worth double-checking this. Ashutosh Financial Services regularly fields questions from NRIs who discover their PAN status was never updated after they relocated. Ashutosh Financial Services runs periodic awareness sessions on exactly these kinds of compliance details that tend to slip through the cracks.

Residential status confusion is close to universal among NRIs, and it’s understandable given how the rules have shifted over the years.

Under the Income Tax Act, residential status for a financial year depends primarily on the number of days spent in India during that year and the preceding years, not on citizenship, visa status, or where someone considers “home.” Broadly, an individual is a resident if they spend 182 days or more in India in the relevant financial year, or meet an alternate day-count test involving the preceding four years, subject to specific carve-outs. Finance Act 2020 introduced tighter conditions for Indian citizens and persons of Indian origin visiting India, reducing the day threshold in certain circumstances, and also introduced the concept of a “deemed resident” for Indian citizens with total Indian income above a specified threshold who aren’t liable to tax in any other country, aimed at addressing tax-residency-nowhere situations.

Within “resident,” there’s a further distinction between Resident and Ordinarily Resident (ROR) and Resident but Not Ordinarily Resident (RNOR), and this distinction matters enormously because ROR status brings global income into the Indian tax net, while RNOR and non-resident status generally limits Indian tax liability to income earned or received in India.

The confusion usually shows up around the year someone moves back to India, or the year they leave. Residential status is determined year by year, not fixed once and forgotten, so someone who was NRI for a decade can shift status the moment their days in India cross the threshold, sometimes without realising it until the return is filed.

Getting this wrong isn’t a minor clerical issue; it changes what has to be reported and taxed entirely. Ashutosh Financial Services routinely helps individuals work through exactly where they land on this test, especially in transition years. Ashutosh Financial Services runs educational sessions specifically on residential status determination given how often it trips people up.

India’s Portfolio Management Services industry sits at an interesting intersection: regulated closely enough by SEBI to give investors real structural protection, yet flexible enough to allow genuinely differentiated investment strategies that a standardised mutual fund scheme can’t offer.

SEBI’s PMS regulations require portfolio managers to be registered, mandate a minimum investment of Rs 50 lakh per client, and require regular, transparent disclosure of portfolio holdings, performance, and fees directly to each client. This direct-ownership structure means every PMS investor holds actual securities in their own demat account, which is fundamentally different from the pooled-unit structure of mutual funds, and it has real consequences: capital gains tax applies at the individual investor level based on their own transaction history within the portfolio, not at the scheme level.

The industry has grown considerably as more portfolio managers have launched strategies spanning large-cap, multi-cap, sectoral, and thematic approaches, giving investors with sufficient capital access to more concentrated, higher-conviction strategies than a diversified mutual fund typically offers. This concentration is precisely the source of both PMS’s appeal and its risk; a portfolio manager’s high-conviction picks can outperform meaningfully in good years and underperform just as meaningfully when those picks don’t work out, more so than a diversified fund would.

Fee structures vary across the industry, some purely fixed as a percentage of assets, others incorporating a performance fee above a hurdle rate, and comparing these structures properly requires looking beyond the headline number to how fees actually behave across different return scenarios.

Selecting a PMS manager is less about chasing the best trailing return, which changes year to year, and more about understanding a manager’s actual investment philosophy and whether it’s one the investor can stay committed to through a full market cycle.

Ashutosh Financial Services helps investors evaluate PMS options against this more complete framework. Ashutosh Financial Services continues its investor education initiatives covering how to assess PMS strategies and managers thoughtfully.

Fixed income doesn’t get the same attention as equity in NRI investment conversations, but for anyone wanting predictable, lower-volatility returns from Indian assets, it’s usually where the real decision-making happens.

NRE and FCNR fixed deposits are the most familiar starting point. NRE deposits, held in rupees, offer interest that’s fully repatriable and tax-free in India, though the exchange rate risk on conversion sits with the investor. FCNR deposits are held in foreign currency, removing that exchange rate risk entirely but generally offering a somewhat lower rate in exchange for that protection. Which one makes sense depends largely on whether the money is likely to be needed in India or abroad eventually.

Government securities and treasury bills are open to NRIs through specific investment routes, and both carry sovereign backing, making them among the lowest-risk fixed income instruments available, though returns are correspondingly modest. State Development Loans work similarly, issued by state governments with slightly different yield profiles.

Corporate bonds and non-convertible debentures offer higher yields than government paper, but that additional yield exists specifically to compensate for higher credit risk, and the credit rating deserves more attention than the coupon rate. Advisors at Ashutosh Financial Services generally recommend checking issuer rating and liquidity before assuming a higher headline number is simply free money.

Debt mutual funds round out the picture, offering professional management and diversification across fixed income instruments rather than exposure to a single issuer, along with more flexibility on entry and exit than most direct bonds. Tax treatment on debt fund gains has changed in recent years and should be checked against current rules before assuming older tax treatment still applies.

None of these options are complicated individually, but they serve different purposes depending on currency preference, liquidity needs, and risk appetite. Ashutosh Financial Services continues to help NRIs match fixed income choices to these specifics rather than defaulting to whichever product happens to be marketed most heavily that season.

An NRE, or Non-Resident External, account is built specifically for foreign income that an NRI wants to bring into India and hold in rupees. Salary earned abroad, savings accumulated overseas, or any income earned outside India can be deposited into an NRE account, converted to rupees at the prevailing exchange rate, and from that point both the principal and any interest earned are fully repatriable and, importantly, tax-free in India.

That tax-free status is what makes the NRE account attractive, but it comes with a condition worth understanding clearly: the funds deposited must genuinely originate from foreign income. Depositing India-sourced income, like rent or dividends from Indian investments, into an NRE account isn’t correct account use, even though the account itself doesn’t automatically flag it. This is precisely why NRO accounts exist as a separate category, and mixing the two undermines the clean tax treatment NRE accounts are meant to offer.

Currency risk sits entirely with the account holder in an NRE account, since deposits are converted to and held in rupees. A depreciating rupee at the time of conversion works in the depositor’s favour when eventually repatriating; an appreciating rupee works against it. This is one reason some NRIs split funds between NRE and FCNR accounts, the latter holding foreign currency directly and avoiding this conversion risk altogether.

NRE accounts also allow full and free repatriation of both principal and interest, without the caps and certification requirements that apply to NRO accounts, which makes them the natural choice for funds an NRI may want to move back abroad without friction. Advisors at Ashutosh Financial Services generally recommend using NRE accounts specifically for this purpose, rather than as a general catch-all for any money moving between countries.

Getting the categorisation right from the start avoids a documentation trail that’s hard to untangle later. Ashutosh Financial Services continues to help NRIs set this up correctly as part of its broader banking and investment advisory work.

▪️ Is it mandatory for a NRI to file Income Tax Return in India ❓

▪️ What are the conditions which makes it mandatory to file Income Tax Return in India ❓

▪️ What are the advantages of filing Income Tax Return in India ❓

👉 Please find the below link for the above topic.

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Ashutosh NRI Services
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Ashutosh Financial Services Pvt. Ltd.
stg.ashutoshfinserv.com

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NRI banking runs on a set of RBI rules that are straightforward once explained, but easy to get wrong by default, mostly because resident-account habits don’t automatically translate.

The first rule is the account itself. Once someone’s residential status changes to NRI, RBI regulations require converting existing resident savings accounts to NRO (Non-Resident Ordinary) accounts, or opening NRE (Non-Resident External) and NRO accounts as appropriate, rather than continuing to operate a regular resident account. NRE accounts hold foreign earnings remitted to India, are fully repatriable, and the interest earned is exempt from Indian income tax for NRIs. NRO accounts hold income earned within India, such as rent or dividends, are taxable, and repatriation is permitted only within RBI-specified limits and procedures.

FCNR (Foreign Currency Non-Resident) deposits are the third piece, allowing NRIs to hold fixed deposits in foreign currency, which removes exchange rate risk on the deposit itself, something NRE deposits (held in rupees) don’t offer.

Repatriation is where RBI’s Liberalised Remittance Scheme and related FEMA provisions come into play, and the rules differ depending on whether funds originate from NRE or NRO accounts, and what the funds represent (sale proceeds of property, inherited assets, current income). Property purchase and sale by NRIs is governed by its own set of FEMA rules too, including restrictions on purchasing agricultural land, plantation property, or farmhouses.

None of this is exotic, but the details around which account holds what, and which repatriation limit applies to which, is where most confusion originates, particularly for NRIs managing finances remotely without regular access to a branch.

Ashutosh Financial Services has guided NRI clients through this account structure for years, and the questions rarely change even as the rules get updated. Ashutosh Financial Services runs periodic educational sessions covering exactly these banking basics for the NRI community.

The default TDS rate an NRI faces when selling property in India often has little to do with their actual tax liability, and that gap is where several legitimate, underused provisions come in.

When an NRI sells immovable property in India, the buyer is required to deduct TDS, and this deduction is typically applied on the full sale value at rates that assume the highest capital gains scenario, rather than on the actual gain after indexation and cost adjustments. This frequently results in tax being withheld well in excess of what’s actually owed, with the difference recoverable only by filing a return and waiting for a refund.

Section 197 of the Income Tax Act offers a more efficient route: an NRI can apply to the jurisdictional Assessing Officer for a certificate for lower or nil TDS deduction, based on the actual computed capital gains rather than the full sale value. Getting this certificate before the property transaction closes means the buyer deducts TDS at the correct, lower rate from the outset, rather than the NRI seller having to fund excess TDS and recover it later through a refund that can take months.

Beyond TDS management, Sections 54, 54EC, and 54F provide capital gains exemptions on the sale of long-term capital assets, if the proceeds are reinvested in a residential property or in specified capital gains bonds within prescribed timelines. These aren’t automatic; they require timely reinvestment and correct filing to claim.

None of these provisions are secret, but they require action before or at the time of the transaction, not after the fact once TDS has already been deducted at the higher default rate.

Ashutosh Financial Services has worked with NRIs to plan property sales around these provisions well before the transaction date, when the options are still available. Ashutosh Financial Services continues to run sessions on tax-efficient structuring of asset sales for the NRI community.

➡️ Is it mandatory for an NRI to file Income Tax Return in India ❓

It is mandatory for an NRI to file Income Tax Return in India if:

1️⃣ The Income exceeds Rs. 2.5 lakhs in India during the year (before giving effect of deductions under Chapter VI-A and certain capital gains exemptions)

2️⃣ Following categories of persons irrespective of the income:

▪️ Deposited an amount exceeding Rs.1 crore in current account/s by any mode during the year or
▪️ The deposit in one or more savings bank account of the person, in aggregate, is rupees fifty lakh or more during the previous year or
▪️ If his total sales, turnover or gross receipts, as the case may be, in the business exceeds sixty lakh rupees during the previous year; or
▪️ If his total gross receipts in profession exceeds ten lakh rupees during the previous year; or
▪️ If the aggregate of tax deducted at source and tax collected at source during the previous year, in the case of the person, is twenty-five thousand rupees or more; or
▪️ Incurred electricity expenditure in aggregate exceeding Rs.1 lakh or
▪️ Incurred an expenditure exceeding Rs. 2 lakh on travel out of India from Indian bank account/s for himself or any other person.

3️⃣ Any taxable capital gain realized in India (Irrespective of basic tax slab exemption i.e. 2.5L).

In other cases, it is not mandatory for any NRI to file an Income Tax Return in India. However, one may choose to voluntarily file it because of several advantages.

➡️ What are the advantages of voluntarily filing Income Tax Return for an NRI?

▪️ Claiming refund of any taxes which have been withheld (TDS deducted).
▪️ Carry forward losses for claiming set-off against future year incomes.
▪️ Obtaining credit of income taxes paid in India against taxes payable in the country of tax residence (where the NRI resides) as per the Double Taxation Avoidance Agreement (DTAA).

➡️ What are the due dates of filing Income Tax Return in India for an NRI?

For Financial Year 2021-22 ended on 31st March, 2022, the last date of filing Income Tax Returns is 31st July, 2022.

Contact us at the earliest to file your Income Tax Returns and become a compliant and proud Indian.

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An NRI with assets in India, and often assets abroad as well, is dealing with a more complicated succession picture than someone whose entire estate sits in one country, which makes a properly drafted will more important, not less.

For assets in India, Indian succession law generally governs how they pass, and which law applies (the Indian Succession Act, or personal laws depending on religion) depends on the individual’s personal law and the nature of the asset. Without a will, intestate succession rules take over, distributing assets according to a fixed legal formula that may not reflect what the individual would actually have wanted, and that can differ meaningfully depending on which personal law applies to them.

A will covering Indian assets should ideally be executed in India, referencing Indian assets specifically, and registered where appropriate, since a will drafted purely under a foreign jurisdiction’s format can create complications when it needs to be probated or recognised by Indian authorities. Many NRIs with assets in both India and their country of residence choose to have two separate wills, one for each jurisdiction, carefully drafted so that one doesn’t inadvertently revoke the other, a mistake that happens more often than people expect when wills are drafted independently by advisors unaware of each other.

Executors and witnesses matter too. An executor familiar with Indian legal and banking processes, and able to act despite being outside India for parts of the process, makes probate considerably smoother than naming someone unfamiliar with the system.

Nomination on individual bank accounts, demat accounts, and insurance policies is worth aligning with the will as well, since nominees hold assets in trust for legal heirs under Indian law in most cases, but a will that contradicts nominations can create confusion for a family already dealing with loss.

Ashutosh Financial Services regularly helps NRI families think through this cross-border succession planning well before it becomes urgent. Ashutosh Financial Services continues to run sessions on estate and will planning specifically for the NRI community.

An NRI’s obligation to file an Indian income tax return doesn’t depend on citizenship or where they live; it depends on whether they have income that is taxable in India, and the threshold for that is lower than many NRIs assume.

Under the Income Tax Act, an NRI is required to file a return in India if their total income earned or received in India exceeds the basic exemption limit, before considering any deductions or exemptions under Chapter VI-A. That income can include rent from Indian property, interest on NRO accounts, capital gains from selling Indian shares, mutual funds or property, and any business or professional income sourced in India. NRE account interest and certain other specifically exempt income don’t count toward this threshold, but nearly everything else earned in India does.

The applicable ITR form matters too. NRIs with straightforward salary and interest income typically use ITR-2, while those with business income use ITR-3, and choosing the wrong form is a common and avoidable filing error. Filing also matters even when tax has already been deducted at source, since TDS on NRI income is often deducted at a flat rate that doesn’t account for exemptions, deductions, or the actual applicable slab rate, meaning a return is frequently the only way to claim back excess TDS as a refund.

There’s a further reason to file even when not strictly required: a filed return is often necessary to access certain banking and investment facilities, and it establishes a documented tax history that becomes relevant if Indian assets are sold or repatriated in future years.

Deadlines and requirements shift from year to year through Finance Act amendments, so relying on last year’s understanding of the rules is a common source of errors.

Ashutosh Financial Services works with NRIs across time zones to keep their Indian filings accurate and on schedule. Ashutosh Financial Services runs periodic sessions specifically addressing NRI return filing obligations.

TCS on foreign remittances under the Liberalised Remittance Scheme has become a familiar, and sometimes dreaded, line item for resident Indians sending money abroad. NRIs, understandably, often assume the same rules apply to them, and that assumption is generally incorrect.

TCS provisions under Section 206C(1G) of the Income Tax Act apply specifically to remittances made under RBI’s Liberalised Remittance Scheme, and LRS itself is a facility available to resident individuals, not to NRIs. NRIs remitting funds out of India, for instance from an NRO account, do so under different FEMA provisions governing repatriation of NRI funds, not under LRS, and since the TCS provision is tied specifically to LRS remittances, it generally does not apply to genuine NRI outward remittances made through the appropriate NRI repatriation channels.

This distinction matters in practice because banks sometimes apply TCS by default unless the remitter’s NRI status and the nature of the remittance are clearly established and documented at the time of the transaction. An NRI repatriating sale proceeds from Indian property or maturity proceeds from an NRO fixed deposit should ensure their bank correctly identifies the transaction as an NRI repatriation rather than processing it as an LRS remittance, since that classification determines whether TCS gets applied at all.

Where an NRI does have Indian-resident family members remitting on their behalf, or where the underlying facts are ambiguous, is exactly the sort of scenario where TCS can end up wrongly deducted, and once deducted, recovering it means claiming credit through an Indian tax return rather than getting it corrected at the bank counter after the fact.

Given how frequently TCS rules have been revised through recent Finance Acts, it’s worth confirming current provisions before assuming any prior year’s understanding still holds.

Ashutosh Financial Services regularly helps NRI clients ensure their repatriation transactions are correctly classified from the outset. Ashutosh Financial Services runs sessions clarifying exactly these kinds of NRI-specific tax distinctions.