As an NRI (Non-Resident Indian), if you decide to sell your property in India and become a foreign citizen by surrendering your Indian passport, you may wonder if there will be any changes in the tax laws or provisions for you. In this article, we will explore this topic in detail.
To begin with, there are two terms that are commonly used in this context – NRI and NR (Non-Resident). NRI refers to an Indian passport holder staying abroad, while NR refers to a non-resident. However, from a tax perspective, there will be no changes in the tax laws if you surrender your Indian passport and become a foreign citizen. Tax provisions will still treat you in the same way as an NRI.
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This means that the same tax rates will continue to be applicable to you, and you will still be eligible to apply for lower TDS (Tax Deducted at Source) on your income. You will also need to file your tax return in India if you are selling a property there, just as you would have done as an NRI.
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Furthermore, you will still be eligible for most of the investments or property purchases in India that were available to you earlier as an Indian passport holder. There may be some minor changes in the Foreign Exchange Management Act (FEMA) regulations, but these will not impact your income tax provisions.
It’s important to note that while there may be some changes in FEMA regulations, they will not affect your income tax provisions. FEMA governs transactions related to foreign exchange and is primarily concerned with issues such as repatriation of funds, acquisition of immovable property, and investment in India by non-residents. If you have questions related to FEMA, it’s advisable to seek professional advice or refer to reliable sources for accurate information.
Conclusion
If you are an NRI who becomes a foreign citizen by surrendering your Indian passport, there will be no significant changes in the tax laws or provisions for you. You will still be treated on par with an NRI in terms of income tax provisions, and you will continue to be eligible for most of the investments or property purchases in India. However, it’s important to stay updated with the latest regulations and seek professional advice if you have any concerns or questions related to tax provisions or FEMA regulations.