Exempt Income for NRIs

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Exempt Income for NRIs – N.D. Savla & Associates

While most types of income earned in India by Non-Resident Indians (NRIs) are taxable, certain categories are specifically exempt under the Income-tax Act, 1961. At N.D. Savla & Associates, we help NRIs identify, structure, and report exempt income correctly so that you enjoy the maximum benefits available while staying fully compliant with Indian tax laws.

Overview

Exempt income for NRIs includes categories where tax is either fully waived or deducted at a reduced rate to encourage investment in India. Proper documentation is essential to claim these exemptions and avoid unnecessary tax payments.

Features

  • Guidance on NRE account interest exemption (fully tax-free for NRIs)

  • Advisory on FCNR deposit interest exemption

  • Exemption on dividends from Indian companies (subject to DTAA conditions)

  • Capital gains exemption on reinvestment under Sections 54, 54EC, and 54F

  • Tax relief on specific government securities and bonds notified for NRIs

  • Assistance in reporting exempt income correctly in the ITR

Documents Required

  • Passport & PAN card

  • NRE/NRO/FCNR account statements

  • Bank interest certificates

  • Fixed deposit receipts (NRE/FCNR deposits)

  • Dividend statements from Indian companies

  • Property purchase/sale documents (if claiming capital gains exemptions)

  • Proof of reinvestment (bonds, residential property, etc.)

Procedure

  1. Income Review – Identify all sources of Indian income.

  2. Exemption Eligibility – Check which categories of income qualify as exempt under the Income-tax Act.

  3. Documentation – Collect necessary proofs such as bank interest certificates, FD receipts, and reinvestment documents.

  4. ITR Filing – Report exempt income under the relevant schedule in the ITR for NRIs.

  5. Cross-Verification – Match exemptions claimed with Form 26AS and bank reports.

  6. Compliance Advisory – Provide tax planning to maximize exemptions while remaining compliant with FEMA and Income Tax rules.

Why This Matters

Many NRIs are unaware of tax-free income categories and end up paying unnecessary tax or facing delays in refunds. With N.D. Savla & Associates, your NRI exempt income in India is structured and reported correctly, ensuring you make the most of your financial benefits without compliance risks.