Income Tax

FEMA/RBI Regulations

Taxation of NRI/PIO Under Income Tax Legislature in India

Like FEMA, there are not much specific tax provisions for NRIs/PIOs (except Chapter XII-A) under Income Tax Legislation in India.

For NRIs/PIOs, there is only one chapter (Chapter XII-A) provided in the Income Tax Act, which deals with some NRI/PIO specific tax provisions. Salient features of the chapter are as under:

In general, the legislation provides for taxation of income on the basis of Residential Status. The same gets applied for NRIs and PIOs as well. Hence, being a Non-Resident (NR) or Not Ordinary Resident (NOR) (or sometimes Ordinary Resident ‘OR’), NRIs and PIOs can be defined as NR or NOR (or OR) and accordingly tax also gets levied. Consequently, in case of NRIs/PIOs as well the taxability of income needs to be understood from combined study of: