July 8, 2025

Non-Resident Indians (NRIs) filing their Income Tax Returns (ITR) in India must stay abreast of the recent changes in tax regulations to avoid any penalties or errors. The Indian government has introduced four key changes that NRIs need to consider while filing their ITR. These changes encompass various aspects of income tax regulations, including tax deductions, investment declarations, and reporting requirements. Let's delve into the details of each change to understand its implications on NRIs filing ITR in India. 1. Introduction of New Tax Regime: The Indian government has introduced a new tax regime that offers lower tax rates without claiming deductions or exemptions. NRIs can choose between the existing tax regime with deductions and exemptions or opt for the new tax regime with lower tax rates but without any deductions. It is essential for NRIs to evaluate their tax liability under both regimes and choose the one that is most beneficial for them. 2. Mandatory Filing of Tax Return for High-Spending Individuals: NRIs who have incurred high spending on electricity bills or foreign travel are now required to file their tax returns in India. This provision aims to ensure that individuals with high spending patterns are also contributing their fair share of taxes. NRIs falling under this category need to declare their global income and ensure compliance with the tax laws of both India and their residing country. 3. Reporting of Foreign Assets and Income: NRIs holding foreign assets or earning income outside India need to diligently report such assets and income in their ITR. Failure to disclose foreign assets and income can lead to penal consequences, including hefty fines and legal actions. NRIs must accurately report all their foreign assets, including bank accounts, properties, investments, and any other income earned outside India. 4. Changes in Tax Residency Rules: The criteria for determining tax residency status have been modified, impacting the tax liability of NRIs. With the introduction of new regulations, NRIs need to reassess their tax residency status based on the number of days they stay in India. It is crucial for NRIs to understand the revised rules to avoid any discrepancies in their tax filings. In conclusion, NRIs filing ITR in India must adapt to the recent changes in income tax regulations to ensure compliance and avoid any penalties. By staying informed about the updated tax laws and regulations, NRIs can fulfill their tax obligations efficiently and accurately.

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Tags: Nris, Itr, Income tax, India,