Introduction Filing income tax returns in India can feel overwhelming, especially if you’re an NRI (Non-Resident Indian) living abroad. But don’t worry. Whether you sold a property, earned rent, or had any income in India in the past year, this guide will make it simple to understand what you need to do for Assessment Year 2025-26.
💡 Update: The last date to file your ITR for AY 2025–26 has been extended to 31st August 2025 (from the original 31st July deadline). If you haven’t filed yet, now is the time!
Table of Contents
- Which ITR form should an NRI use?
- When do NRIs need to file ITR?
- Do NRIs need to declare foreign income or assets?
- What if you sold a property?
- What are the latest tax rules you should know?
- Frequently Asked Questions (FAQs)
1. Which ITR form should an NRI use? If you are an NRI, you cannot use the basic ITR-1 form. Most NRIs will need:
ITR-2: If you earned income from property sale, rent, interest, or investments in India.
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- ITR-3: If you earned income from a business or profession in India.
- ITR-4: Only if you opted for the presumptive taxation scheme and had no foreign income or assets.
2. When do NRIs need to file ITR? You must file ITR if:
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- Your income in India was more than ₹2.5 lakh in the last financial year (Apr 2024 – Mar 2025).
- You want to claim a TDS refund (tax deducted when you sold property or earned interest).
- You have foreign assets or income to report.
3. Do NRIs need to declare foreign income or assets? Yes, if you are filing ITR-2 or ITR-3, and you:
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- Own a bank account or mutual fund outside India.
- Have income from foreign employment, property, or stocks. You must fill a special section called Schedule FA (Foreign Assets). This is important to avoid notices or penalties.
4. What if you sold a property in India? If you sold property in India:
The buyer must deduct TDS at 12.5% + cess + surcharge on the full sale value, not just the profit.
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- If your actual profit (capital gain) is less than the tax deducted, you can claim a refund by filing ITR.
- You can also reduce TDS before the sale by applying for a certificate using Form 13.
5. What are the latest tax rules you should know?
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- TDS rate for NRIs on long-term capital gains from property is 12.5% + cess + surcharge. For short-term gains (if sold within 2 years), tax applies at your slab rate.
- You can reinvest capital gains in another property or bonds (under Section 54 or 54EC) to save tax.
- NRIs can repatriate up to $1 million per financial year after paying taxes and filing Form 15CA/CB.
- Filing ITR is mandatory to get any refund or carry forward losses.
6. Frequently Asked Questions (FAQs)
Q1. Can I use ITR-1 as an NRI?
No. ITR-1 is only for resident Indians.
Q2. I have no income in India. Should I still file?
Only if you want to claim a refund or report foreign assets.
Q3. What happens if I don’t report my foreign assets?
You may receive a notice from the Income Tax Department. Always disclose honestly.
Q4. I sold a property. Do I need to file ITR even if TDS was deducted?
Yes. TDS is just an advance tax. File ITR to calculate exact tax and get a refund if applicable.
Q5. Can I file from abroad?
Yes. You can file your return online using your PAN and Aadhaar (or Aadhaar exemption).
Final Word from NRI Simplify Filing taxes in India as an NRI doesn’t have to be stressful. With the right help, you can claim refunds, stay compliant, and avoid penalties. If you’ve sold property, earned income, or need guidance, NRI Simplify is here to make the process easy for you.
Need help filing your ITR?
Reach out to NRI Simplify today.
