government has been reviewing its policies to attract
investment by NRIs in real estate. In its mid-term review of
the economic policy for 2006-07, the RBI
the lock-in period for the sale proceeds of property
credited to NRO accounts, with a cap of USD1 million.
the full repatriation of income from the rented porperty
after payment of tax.
tax exemptions from wealth tax on commercial and
reasidential property for at least 300 days in a calendar
Government of India has entered into tax treaties or Double
Tax Avoidance Agreements (DTAA) with several countries where
Indians reside in large numbers. The treaties aim to protect
taxpayers from paying double taxes in India and the adopted
country. The treaties have provided for tax to be deducted at
source out of payments to NRIs and PIOs to facilitate the
process of assessment of taxes due by them.
Income tax Act, 1961 (ITA) defines the taxability of an
individual in India, which is dependent on his residential
per the ITA, the different residential status can be
Resident - An individual who stays in India in a year ending
March 31 for at least 182 days, or an individual who stays in
India in a financial year ending March 31 for at least 60 days
in that year, and a total of 365 days in the preceding 4
period of 60 days is extended to 182 days for
Resident (ROR) - an individual who is not a RNOR or an
individual who is resident and ordinarily Indian, is taxed on
his income received from India or deemed to receive in India
in the relevant financial year.
citizens who leave India for employment outside India,
citizens who are crew members of an Indian ship
citizens or a Person of Indian Origin who visits India in
individuals in the Resident and Ordinarily Resident category,
global income is taxable in India.
but Not Ordinarily Resident (RNOR) - an individual who does
not reside in India in 9 out of 10 years before the previous
year, or a person residing in India for 729 days or less
during the previous 7 years before the previous
RNOR is taxed in India on the income which accrues or arises
in India. No tax liability accrues in respect of any income,
which may accrue or arise out of India.
An individual who does not fall into the above resident
categories is a Non Resident
Non-Resident is taxed in India on the income received or
deemed to be received in India or accrues or arises or deemed
to accrue or arise in India, in the relevant financial