Active Stocks
Tue Mar 05 2024 15:53:49
  1. ICICI Bank share price
  2. 1,088.10 -0.34%
  1. Tata Motors share price
  2. 1,021.95 3.52%
  1. Tata Steel share price
  2. 151.85 -0.82%
  1. NTPC share price
  2. 358.25 1.26%
  1. Titan Company share price
  2. 3,748.45 0.44%
Business News/ Money / Personal Finance/  How can NRIs claim tax deduction in India?
BackBack

How can NRIs claim tax deduction in India?

For deductions under section 80C, the investments allowed to NRIs are: life insurance premium payment and children’s tuition fee paid to any school, college, university or educational institution situated in India for full-time education of any two children

How can NRIs claim tax deduction in India?Premium
How can NRIs claim tax deduction in India?

How can a Non-Resident Indian (NRI) claim tax exemption of up to 1.5 lakh (from funds in NRO account) under 80C and other sections. Can NRIs invest in equity-linked saving schemes (ELSS)?

—Prakash Cherukuri

(NRIs) are eligible to claim deductions under section 80C in a similar way that resident taxpayers do. Several options are available under section 80C. NRIs are also eligible for investing in (ELSS).

For deductions under section 80C, the investments allowed to NRIs are: life insurance premium payment and children’s tuition fee paid to any school, college, university or educational institution situated in India for full-time education of any two children.

For rebate on the life insurance premium, the policy must be in the NRI’s name or in the name of their spouse or any child (child may be dependent/independent, minor/major, or married/unmarried). The premium must be less than 10% of the sum assured.

They can also claim 80C deduction on principal repayments for a home loan taken for buying or constructing residential house property.

There are certain investments that NRIs are not permitted to make and these are not available to them as deduction under section 80C. Investment in PPF accounts is not allowed for NRIs, however, PPF accounts opened while they were resident in India are allowed to be maintained.

Schemes like post office 5-year deposit and senior citizen savings schemes are also not available to NRIs.

Is the interest on non-resident external (NRE) deposits included to determine a person’s total income in India?

—Name withheld on request

Interest earned on deposits held in NRE accounts are exempt from tax in India and not required to be included in determining the total taxable income in India.

However, as soon as the NRI returns to India with the intention of living for an undetermined period or plans in India, NRE accounts should be converted to resident account and any interest earned after such conversion shall be taxable in India.

Archit Gupta is founder and chief executive officer, Clear.in.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Check all the latest action on Budget 2024 here. Download The Mint News App to get Daily Market Updates.
More Less
Published: 19 Dec 2022, 10:29 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App