There are quite a few people these days who are currently working abroad once they have completed their education. By birth they are still citizens of India but career wise they have chosen some other country to live in.
But sometimes there are a few people who do not do a job in foreign land but they go for a business. This business might have the main root in India (like a family business) and one has just expanded it to a different country as well. Though that person is not living in India (as he/she handles the business abroad) as their income comes from both the lands, they will need to file the NRI income tax for the income they get from India. For that, NRI tax planning firms in Pune can be of great help.
But what exactly is NRI taxation? Well, it is a different system to incur income tax on people who are definitely residing in India and have a steady earning source from the country as it has been mentioned above. But before lodging the NRI taxation on the annual income of a person one has to determine the eligibility of that particular person. This eligibility will make one to fall under the category of a tax paying NRI. If the person can meet the specific criteria for a proper tenure in India and outside then they will become eligible for the NRI taxation.
What are the taxable income sources of an NRI individual? Here are a few things:
- A person’s residential status can determine the NRI taxation system of that particular individual. The taxation system can depend on the origin of income of that person and their location. If their source of income belongs to India then the taxation will be as per the Indian Income tax system. But if the person is a permanent citizen of a different country then the NRI taxation will apply only to their income portion which happens from India.
- The imposition of the NRI taxation is based on the income of a person who is providing service in India. If one transfers any asset to India in return of a considerable amount of capital gains or money then they will fall under the category of NRI income tax. NRI income tax will also be applicable to any rental income in India for any fixed deposits and tangible properties.
There are quite a few ways through which an NRI can claim for income tax benefits. One of them is by claims on life insurance. An NRI can always opt for the tax deduction in case of life insurance policies. This can help one to exempt certain portions of the life insurance policies if that are under the name of the spouse or the child of that particular individual. Also, if an NRI is paying a fixed EMI on any principal amount then also income tax benefits can be claimed on that. One can get a clear idea from an NRI tax consultant pune and proceed accordingly.