I just saw this post on social net. It’s mentioned that tax free for NRIs. Sometimes it feels like NRIs r tax free & another way increasing those taxes for individuals jaise ki NRI ka tax individuals se collect kr rhe hai
How this sounds an erratically as an individual ending with paying more taxes whether he is trader, investor, in profit, in loss, on dividends, redemption taxes. Every year we hear increase in taxes, but simultaneously in India there are no such benefits for an individual also.
When as a individual if try to invest globally there also pay tax, transaction charges & many more, account charges whether direct or indirect investment.
All non-resident Indians are non-residents.
But not all non-residents are non-resident Indians.
Just in case it wasn’t obvious to anyone reading that,
this is not about NSE, but NSE-IX in IFSC GIFT city, a separate entity in a separate jurisdiction.
Also, the investments are USD-denominated, there is no INR involved.
The target audience is foreign nationals. (and probably foreign institutions?)
Just to put some perspective on the above. Non Residents Indian, get tax free income only on deposits which is from NRE account. Only funds earned abroad and transferred back to India can be routed thought this account. Tax free is only on these deposits.
NRI when they buy and sell shares, TDS at the highest rate is deducted at source. They can ofcourse get it back if we file ITR returns, if not this is gone.
Any sale of property etc even if the buyer is an NRI and willing to pay to a NRE account is not allowed. This funds should be credited to NRO account and taxes need to be paid.
Most of the company deposits, an NRI cannot place it under NRE category even though the money is transferred from abroad. They have to route it to NRO account and TDS gets automatically computed and deducted.
When a NRI sells property to another NRI and even if the registration amount at the department is less than 50L, TDS needs to be deducted and the buyer first need to get his TAN and only then the TDS can be credited to Govt account and then get 16A certiticate. All this is not there for residents. Thank God that Govt has removed the need for TAN from the buyer during this budget. People or agents who do these transactions are not aware and on the transaction date the registration dept will say not possible. The NRI just came for this and transaction cannot happen due to TAN formalities.
This is not confirmed but I heard that if a NRI has a house in India and getting rent the tenant it seems need to deduct taxes and then only put the money into a NRI’s NRO account.
Cant open PPF account even under NRO category. Yes, NPS is allowed.
So it is not full of tax free …
The other side of the coin is that, yes, NRI deposits get tax free interest income, can open foreign currency deposits (FCNR) and money which is credited in the NRI account can be freely repatriated at the current exchange rate.
Yes they get treated as “King” among banks in India even if he is a chaparasi outside. The hospitality granted by banks in Keralam is astounding. They get special welcome when they come to India. Bankers come home to meet them, the treatment they get at the branch feels as if they were my 'in-laws" . Compliment/gifts and lunch invites are thrown in. No wonder some wear “rayban” glasses inside the branch and keeps a 500note on his transparent shirt pocket. Their wifes look like broiler chicken and show attitude as if her husband was an actor…Gets coffee/chai from outside and not the sada chai from the kitchen of the branch…pours perfume and walks in… and the entire branch smell good. .Damn… pure jealousy being spewed out…
If someone has seen Amitabh Bachchan starrer IDFC bank Ad where they are advertising their NRI A/C and AB is addressing a Lion saying ‘Bhai Aap to Raja Hain’,he will know what kind of VIP treatment these NRIs get at banks
