Living overseas doesn’t anyway affect possibilities. Indians, living overseas save money in dual aspects branching into putting them predominantly in overseas accounts and Indian accounts. However the Non resident Indian needs to take a look at all the taxation procedures furthermore helping him best understand what Indian taxation is all about.
A NRI should most importantly comprehend the fact that he has to pay taxes for whatever that comes out of his property or assets or investments or far closest, something that belongs to him generating considerable income in India; nevertheless he wouldn’t be paying for what he earned outside the country. Yet again, Foreign Income and Indian Income need to be best taken in with no confusion. Receiving an income in India Wherein generated anywhere not specifically India, this gets termed Indian Income. Foreign Income is when there is an Income generation and obtainment outside the parent country.
With the Income tax act of 1961 there are options that permit tax deductions for NRIs ensuring a complete pass in the designed rules. Certain Incomes for NRIs are tax exempt namely the NRNR and foreign currency deposits, the foreign income, dividend from Indian companies, Mutual funds and long term capital gains triggered from a well known stock exchange with a mutual fund tax exemption at par with citizens, if on getting a fee from a consultancy that holds offers for employees under a sponsored program where money comes from a non resident country.
Areas of deduction are quite possibly flexible. Availing deductions from home loan interests and the EMI are okay. When it comes to savings, then there are lots more tuned options like equity investments, debt investments, NSC, Pension plans and Life Insurance and Fixed deposits.
What NRIs can’t do is that they wouldn’t be allowed to open a PPF account however if it’s already active it shouldn’t be working anymore after maturity.
Investments in National Saving certificates, Senior citizens savings scheme, Post office time deposits are definitely unavailable to NRIs...
NRIs can demand deduction in premium of Health insurance and medical policies. They can also opt for loan deductions in the areas of education, medical facilities and so on.
However every NRI has to best effectively understand rules for an implementation that comes out errorless...
