How NRI Taxation Works
NRI taxation depends on your residential status determined by days spent in India. NRIs are taxed only on Indian income. RNORs are taxed on Indian income + foreign business income controlled from India. Residents are taxed on global income. DTAA provisions can reduce or eliminate double taxation.
Formula
NRI: Tax on Indian Income only
RNOR: Tax on Indian Income + Foreign Business Income
Resident: Tax on Global Income
DTAA Credit: Lower of (India Tax, Foreign Tax)Residential Status Determination
| Status | Days in India | Taxable Income |
|---|---|---|
| NRI | < 182 days | Indian income only |
| RNOR | ≥ 182 days (with conditions) | Indian + foreign business |
| Resident | ≥ 182 days (or 60+ with history) | Global income |
Common NRI Income Sources & Taxation
Rental Income: Taxable at slab rates. 30% TDS if rent exceeds ₹50,000/month. Can claim standard deduction of 30% and interest on home loan.
Capital Gains: Sale of Indian property or stocks is taxable. LTCG on property at 20% with indexation, LTCG on equity at 12.5% (above ₹1.25L), STCG on equity at 20%.
Interest Income: NRE/FCNR account interest is tax-free. NRO account interest is taxable at slab rates with 30% TDS. Fixed deposit interest is taxable.
Foreign Income: Not taxable for NRIs. Taxable for residents. RNOR status depends on whether business is controlled from India.
Common questions
Who is considered an NRI for tax purposes?
You're an NRI if you stay in India for less than 182 days in a financial year. If you're in India for 60-181 days AND less than 365 days in the preceding 4 years, you're also an NRI. NRIs are taxed only on Indian income.
What is RNOR status?
RNOR (Resident but Not Ordinarily Resident) is an intermediate status. You're RNOR if you've been an NRI in 9 out of 10 preceding years, or stayed in India less than 729 days in the preceding 7 years. RNORs are taxed on Indian income + foreign business income controlled from India.
What income is taxable for NRIs?
NRIs are taxed only on income earned or accrued in India: salary for services in India, rental income from Indian property, capital gains on Indian assets, interest on Indian bank accounts (except NRE accounts), and business income from India.
What is DTAA?
DTAA (Double Taxation Avoidance Agreement) prevents you from paying tax on the same income in both India and your country of residence. India has DTAA with 90+ countries. You can claim tax credit or exemption under DTAA provisions.
Are NRE account deposits taxable?
No. Interest earned on NRE (Non-Resident External) and FCNR accounts is tax-free in India. However, interest on NRO (Non-Resident Ordinary) accounts is taxable at slab rates with 30% TDS.
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Request a calculator →Disclaimer: NRI taxation is extremely complex and depends on residential status, income sources, DTAA provisions, and country-specific rules. This calculator provides rough estimates only. STRONGLY RECOMMENDED: Consult a qualified chartered accountant specializing in NRI taxation for accurate assessment and compliance.
Last updated: May 2026