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Dear NRI, Have you filed your income tax returns ?

There is a general belief that NRIs do not have to pay any income tax in India and most NRIs neglect tax as something not affecting them.

In reality NRIs have tax exemption only for income generated from abroad. Even if you are an NRI, you are liable to pay income tax on whatever income you earn from India – for example, rent from property, profit from sale of assets or dividend from shares.

However, this is applicable only if your income in India crosses the basic exemption limit of Rs 2 lakh per year.

Who is an NRI ?

To determine if you are eligible for tax exemptions, you need to find out your residential status based on number days spent in India.

The Income tax department classifies an individual to be a non-resident when:

What income is taxable ?

In short, you have to sum up all the incomes which either originate in India or are received here. The tax slabs applicable to NRIs are the same as residents and can claim deductions if you are above 60.

The due date for filing returns by NRIs is 31 July. (Note : For 2015, the deadline has been extended to 31 August 2015).

Documents

The documents to be submitted include the passport to show the number of days spent outside India to qualify as an NRI. Besides this, the NRIs need to provide the statements for the demat accounts, for the transactions and bank accounts held in India, as well as the TDS certificates received from other parties.

Filing alternatives

The NRIs can file their tax returns online on the Income Tax Department e-filing portal. Alternatively, they can use other private, paid e-filing portals to do so, or even take the help of tax advisers.

Points to note

It is not necessary for an NRI to file tax returns if the total income during the relevant financial year consists only of investment income or long-term capital gains, or both, and the tax has been deducted at source from such income.