{"id":760,"date":"2026-01-30T10:41:00","date_gmt":"2026-01-30T10:41:00","guid":{"rendered":"https:\/\/www.nritaxservice.in\/blog\/?p=760"},"modified":"2026-02-10T10:04:06","modified_gmt":"2026-02-10T10:04:06","slug":"budget-2026-tax-implications-on-nris-oci","status":"publish","type":"post","link":"https:\/\/www.nritaxservice.in\/blog\/2026\/01\/30\/budget-2026-tax-implications-on-nris-oci\/","title":{"rendered":"India Fiscal Budget 2026 for FY 2026-27 \u2013 Its Impact On Non Residents ie OCIs, NRIs, Seafarers, Other Non-Residents"},"content":{"rendered":"\n
On Feb 1, 2026, Smt Nirmala Sitharaman the India Honourable Finance Minister has presented India\u2019s Annual Budget. It was her 9th consecutive budget presentation, and with this she equals her record with Shri P C Chidambaram which is second highest, and now she is just one short of the most budgets presented by India Finance Minister i.e. Shri Morarji Desai who has presented it 10 times. In this annual statement, she announced various tax proposals and other proposals. Hereunder are synopsis of some proposals which will have impact on Expatriates, NRIs, PIOs, OCIs, Seafarers and other Non-residents.<\/p>\n\n\n\n
<\/div>\n\n\n\n
Tax Rates, Tax Slabs For Tax Year 2026-27 <\/strong><\/h2>\n\n\n\n
Old Regime i.e. Tax Slabs where various deductions are allowed however, tax rates are higher \u2013 Not a good option for Non-residents: No change is proposed in Old regime under the Tax Proposals 2026. Hereunder is a 3 years comparative table, which depicts the tax rates slab basis for last 3 years.<\/p>\n\n\n\n
3 Years Comparison of Tax Rates under Old Tax Regime<\/h3>\n\n\n\n
Old Regime \u2013 Tax Slab & Rates<\/strong><\/center><\/td><\/tr>
FY 2024-25<\/strong><\/td>
FY 2025-26<\/strong><\/td>
Proposals for FY 2026-27<\/strong><\/td><\/tr>
Tax Slabs<\/strong><\/td>
Tax Rates<\/strong><\/td>
Tax Slabs<\/strong><\/td>
Tax Rates<\/strong><\/td>
Tax Slabs<\/strong><\/td>
Tax Rates<\/strong><\/td><\/tr>
<= 2.50 Lakh<\/strong><\/td>
Nil<\/strong><\/td>
<= 2.50 Lakh<\/strong><\/td>
Nil<\/strong><\/td>
<= 2.50 Lakh<\/strong><\/td>
Nil<\/strong><\/td><\/tr>
2.50 Lakh to 5 Lakh<\/strong><\/td>
5%<\/strong><\/td>
2.50 Lakh to 5 Lakh<\/strong><\/td>
5%<\/strong><\/td>
2.50 Lakh to 5 Lakh<\/strong><\/td>
5%<\/strong><\/td><\/tr>
5 Lakh to 10 Lakh<\/strong><\/td>
20%<\/strong><\/td>
5 Lakh to 10 Lakh<\/strong><\/td>
20%<\/strong><\/td>
5 Lakh to 10 Lakh<\/strong><\/td>
20%<\/strong><\/td><\/tr>
>10 Lakh<\/strong><\/td>
30%<\/strong><\/td>
>10 Lakh<\/strong><\/td>
30%<\/strong><\/td>
>10 Lakh<\/strong><\/td>
30%<\/strong><\/td><\/tr>
Hence, it can be seen from above table that there is no change provided since last few years in Old Regime Tax Slabs and Rates. Actually, Govt want to shift tax payer to new regime, hence, no change is proposed in Old regime.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
New Regime i.e. Tax Slabs where deductions are not allowed but tax rates are lower \u2013 Good For Non Residents:<\/h3>\n\n\n\n
No change is proposed in New regime under the Tax Proposals 2026. There were significant changes (towards tax payer beneficial by reducing taxes) were already made in earlier year Tax Proposals. Hereunder is a 3 years comparative table, which depicts the tax rates slab basis for last 3 years.<\/p>\n\n\n\n
3 Years Comparison of Tax Rates under New Tax Regime<\/h3>\n\n\n\n
\n
\n
\n
New Regime \u2013 Tax Slab & Tax Rates<\/strong><\/td>\n <\/tr>\n
\n
\u00a0FY 2024-25 ie AY 2025-26<\/strong><\/td>\n
\u00a0FY 2025-26 ie AY 2026-27 <\/strong><\/td>\n
Proposals for FY 2026-27 <\/strong><\/td>\n <\/tr>\n
Like Resident tax payers, Non Residents tax payers also have option to choose from Old Regimes or New Regimes. Though in most of the cases, New Regime will be beneficial for Non-Residents (NRIs, OCIs etc). Also, New Tax Regime does not require various investments etc for deduction, hence, NRIs can straight away seek the benefit of low tax without making unnecessary investments for tax saving. Hence, tax proposals under New Regime is what NRIs look forward and any positive change is a welcome budget proposal for NRIs, Non-residents.<\/li>\n\n\n\n
There are several changes made in New Regime since last few years. Hereunder is a table of tax comparison and benefit out of it<\/li>\n<\/ul>\n\n\n\n
Proposed Tax Vs Earlier Years Tax \u2013 Benefit For Tax Payers<\/h3>\n\n\n\n
\n
\n
\n
Income(Rs)<\/strong><\/td>\n
Tax (FY 2024-25) (A)<\/strong><\/td>\n
Tax (FY 2025-26) (B)<\/strong><\/td>\n
Tax (FY 2026-27) (‘C)<\/strong><\/td>\n
Tax Benefit (A-C)(FY 26-27 Vs FY 24-25)<\/strong><\/td>\n
Tax Benefit (B-C)(FY 26-27 Vs FY 25-26)<\/strong><\/td>\n <\/tr>\n
\n
4 Lakhs<\/td>\n
5,000 <\/td>\n
–\u00a0<\/td>\n
\u00a0–\u00a0<\/td>\n
\u00a05,000 <\/td>\n
\u00a05,000 <\/td>\n <\/tr>\n
\n
5 Lakhs<\/td>\n
10,000 <\/td>\n
5,000 <\/td>\n
5,000 <\/td>\n
5,000 <\/td>\n
5,000 <\/td>\n <\/tr>\n
\n
6 Lakhs<\/td>\n
15,000 <\/td>\n
10,000 <\/td>\n
10,000 <\/td>\n
5,000 <\/td>\n
5,000 <\/td>\n <\/tr>\n
\n
7 Lakhs<\/td>\n
20,000 <\/td>\n
15,000 <\/td>\n
15,000 <\/td>\n
5,000 <\/td>\n
5,000 <\/td>\n <\/tr>\n
\n
8 Lakhs<\/td>\n
30,000 <\/td>\n
20,000 <\/td>\n
20,000 <\/td>\n
10,000<\/td>\n
10,000<\/td>\n <\/tr>\n
\n
9 Lakhs<\/td>\n
40,000 <\/td>\n
30,000 <\/td>\n
30,000 <\/td>\n
10,000 <\/td>\n
10,000 <\/td>\n <\/tr>\n
\n
10 Lakhs<\/td>\n
50,000 <\/td>\n
40,000 <\/td>\n
40,000 <\/td>\n
10,000 <\/td>\n
10,000 <\/td>\n <\/tr>\n
\n
11 Lakhs<\/td>\n
65,000 <\/td>\n
50,000 <\/td>\n
50,000 <\/td>\n
15,000 <\/td>\n
15,000 <\/td>\n <\/tr>\n
\n
12 Lakhs<\/td>\n
80,000 <\/td>\n
60,000 <\/td>\n
60,000 <\/td>\n
20,000 <\/td>\n
20,000 <\/td>\n <\/tr>\n
\n
15 Lakhs<\/td>\n
1,40,000 <\/td>\n
1,05,000 <\/td>\n
1,05,000 <\/td>\n
35,000 <\/td>\n
35,000 <\/td>\n <\/tr>\n
\n
16 Lakhs<\/td>\n
1,70,000<\/td>\n
1,20,000 <\/td>\n
1,20,000 <\/td>\n
50,000 <\/td>\n
50,000 <\/td>\n <\/tr>\n
\n
20 Lakhs<\/td>\n
2,90,000 <\/td>\n
2,00,000 <\/td>\n
2,00,000 <\/td>\n
90,000<\/td>\n
90,000<\/td>\n <\/tr>\n
\n
24 Lakhs<\/td>\n
4,10,000 <\/td>\n
3,00,000 <\/td>\n
3,00,000 <\/td>\n
1,10,000 <\/td>\n
1,10,000 <\/td>\n <\/tr>\n
\n
30 Lakhs<\/td>\n
5,90,000 <\/td>\n
4,80,000 <\/td>\n
4,80,000 <\/td>\n
1,10,000 <\/td>\n
1,10,000 <\/td>\n <\/tr>\n
\n
60 Lakhs<\/td>\n
14,90,000<\/td>\n
13,80,000 <\/td>\n
13,80,000 <\/td>\n
1,10,000 <\/td>\n
1,10,000 <\/td>\n <\/tr>\n
\n
Surcharge and Cess is not calculated in above which will be extra.<\/em><\/strong><\/td>\n <\/tr>\n<\/table>\n<\/figure>\n\n\n\n
<\/div>\n\n\n\n
India Budget 2026 \u2013 NRI Immovable Property Sale Transactions TDS Deposit Simplified<\/strong><\/h2>\n\n\n\n
A welcome change is made for Non-residents (OCIs, NRIs) who are selling an immovable property in India. As per the proposed change, now TDS on NRI property sale matters can be deposited with Buyer\u2019s PAN and there will not be any requirement of obtaining TAN by the buyer.<\/p>\n\n\n\n
Its Impact on NRIs: Presently, whenever an NRI or other non-resident plans to sell an immovable property in India then buyer is under obligation to obtain TDS Number (TAN) to complete the TDS payment and TDS return filing process. Due to this additional hassle, many prospective buyers show their reluctance to buy property from Non-resident. Also, due to the time taking process for TAN, TDS deposit process gets delayed. Now, since the TAN requirement has been removed, immovable property sale transactions will be very convenient for NRI sellers as well as buyers.<\/p>\n\n\n\n
<\/div>\n\n\n\n
More Time To File Revise ITR<\/strong><\/h2>\n\n\n\n
Honourable FM has also provided relief in terms of filing of Revised ITR. Earlier the due date of filing of Revise ITR was December 31. Now, it is proposed to increase it by 3 months, hence, it can be filed upto March 31 of next year.<\/p>\n\n\n\n
Its Impact on NRIs:<\/em><\/strong>\u00a0In many cases, taxpayer need to revise their ITR due to some error or miss in the original ITR which comes to his\/her knowledge later on. NRIs, who are generally not very much in touch with Indian things miss the opportunity to revise the ITR due to limited time window for revision. Now, with the enhanced time frame for revision, NRIs can revise their ITR upto March 31 of next year. It will also give them relief in the month of December when they generally busy in holiday travelling etc.<\/p>\n\n\n\n
<\/div>\n\n\n\n
Amnesty Scheme For Undisclosed Foreign Assets & Income \u2013 Returning NRIs, ROR <\/strong><\/h2>\n\n\n\n
There is a very welcome amnesty scheme proposed in this budget. Many NRIs who have returned back to India and other Resident Tax payers, who had no intent of tax evasion but ignorantly missed in reporting their foreign assets or foreign income due to misinterpretation of reporting rules, lack of awareness or any other reason, Union Budget 2026-27 proposes to offer a one-time 6-months window for disclosing such income or assets below a certain value. Scheme is provided for two type of defaulters as under:<\/p>\n\n\n\n
\n
\n \n
\n
\n Taxpayers who did not disclose overseas income or assets at all\n <\/th>\n
\n Taxpayers who paid tax on overseas income but failed to declare the assets acquired\n <\/th>\n <\/tr>\n
\n
\n Applicability<\/strong> \u2013 undisclosed income\/value of assets is up to Rs 1 crore
\n Amnesty Scheme<\/strong> \u2013 Amount payable to receive immunity from prosecution =\n Tax 30% of fair market value of undisclosed asset or income + additional 30% tax in lieu of penalty\n <\/td>\n
\n Applicability<\/strong> \u2013 value of assets up to Rs 5 crores
\n Amnesty Scheme<\/strong> \u2013 Amount payable to receive immunity from both penalty and prosecution =\n one-time fee Rs 1 lakh\n <\/td>\n <\/tr>\n <\/tbody>\n <\/table>\n<\/figure>\n\n\n\n
Analysis:<\/h3>\n\n\n\n
\n
Presently, returning NRIs and Resident taxpayers who have undisclosed foreign income or foreign assets, have to face the wrath of the income tax department with the levy of heavy penalty and prosecution. They have to face this uncomfortable situation even if such non-disclosure is unintentional.<\/li>\n\n\n\n
This scheme comes as a major relief in such cases by providing relief from penalty and prosecution upon payment of one-time fee or payment of additional tax accordingly. <\/li>\n<\/ul>\n\n\n\n
Why this scheme is critical for NRIs?<\/h3>\n\n\n\n
The scheme provides complete exit from exposure to Black Money Act. In case this opportunity is missed, it will lead to long term prosecution and heavy penalties. <\/p>\n\n\n\n
<\/div>\n\n\n\n
Changes in Liberalised Remittance Scheme (LRS) <\/strong><\/h2>\n\n\n\n
It is very common for NRIs and their families to remit funds abroad for medical treatment, international travel, education of children, etc. Presently, a high TCS rate is applicable on such remittances resulting in disruption of cashflows and extra compliances. Budget 2026-27 has provided a major relief by reducing the rates of TCS as under<\/p>\n\n\n\n