mytaxes ASK ANSWER DISCUSS
April 18, 2014, 06:52:31 PM *
Welcome, Guest. Please login or register.

Login with username, password and session length
News: Play Teen Patti online with on LIVE public table. Available for iPhone and iPad. www.octroteenpatti.com. Play for fun and recreation (no gambling). Play in real time with your Facebook friend or other players all over the world.
 
   Home   Help Search Login Register  
Pages: [1]   Go Down
  Print  
Author Topic: Taxes on NRO account  (Read 12165 times)
boxer
Jr. Member
**
Posts: 9


« on: August 13, 2008, 11:30:04 PM »

I am a US citizen of Indian origin, resident in the US. I have an NRO account in India, from Rupee funds arising in India (previous Indian job, etc).

Currently, all interest earned in that account is subject to a withholding tax (tax deducted at source by the bank, TDS.) Is there a way to avoid this tax, such as putting the money in some type of account, bond, mutual fund, PO savings, National Savings Certificates, etc available to NRIs which is not taxed, This would have to be an NRO type account (not NRE or FCNR) since the funds are currently in an NRO and are from India based sources, in Rupees. Purpose is so as to avoid hassle of having to file a tax return to obtain refund of TDS.

Alternatively, I have heard of Form 15G or 15H. What is this, does it elimnate TDS?

Thank you in advance for your help.
Logged
jss
Sr. Member
****
Posts: 52


« Reply #1 on: August 14, 2008, 06:41:59 AM »

For bank interest (section 194A) even a non-resident can file Form 15G so that TDS is not deducted by the bank (section 197A). For this your tax on total income of the previous year must be nil. The form 15H/15G covers only the maximum amount not chargable to tax, which is Rs. 1,50,000 for financial year 2008-09.

The form is available from the bank. Submit the form in duplicate to the bank itself. It is for the bank to send a copy of Form 15G to the income tax department.

A non-resident can submit Form 15G only for interest on securities (section 193), interest other than securities (section 194A) and interest on Units (section 194K). It can not be submitted for any other income.
« Last Edit: October 21, 2008, 07:02:15 AM by TaxExpertMyTaxes » Logged
boxer
Jr. Member
**
Posts: 9


« Reply #2 on: August 14, 2008, 01:28:05 PM »

Thank you for this reply. I understand the response for Form 15G.

However, on the first part of my question -- are there any non-taxable NRO type accounts available for NRIs -- can you also please provide an answer. I think filing Form 15G only avoids TDS but not need to file taxes if the income exceeds the limit, so I am looking to see if there is a type of account/investment which is tax-free, so need need to file 15G or file tax return etc.
Logged
MyTaxes_Expert
Administrator
Sr. Member
*****
Posts: 223


« Reply #3 on: August 17, 2008, 03:01:28 AM »

On NRO account, the bank must deduct TDS unless Form 15G is filed.
Only NRE (Non-resident external) account is not taxable in India.
Logged
boxer
Jr. Member
**
Posts: 9


« Reply #4 on: August 18, 2008, 01:20:56 PM »

So NRIs cannot own National Savings Certificates or Mutual Funds or PO Savings (or other such accounts where earnings are not taxed)?
Logged
boxer
Jr. Member
**
Posts: 9


« Reply #5 on: August 25, 2008, 03:51:54 PM »

Can anyone answer this question -- can NRIs own Nationals Savings Certificates, PO Savings accounts, Tax Free Bonds (such as Govt of India bonds, UTI bonds, etc), which are tax free.
Logged
jss
Sr. Member
****
Posts: 52


« Reply #6 on: September 09, 2008, 03:13:01 PM »

You should read this:
http://www.incometaxindia.gov.in/publications/9_Income_Tax_For_NRI/Chapter007.asp
Logged
boxer
Jr. Member
**
Posts: 9


« Reply #7 on: September 10, 2008, 03:50:58 PM »

Thank you very much for replying. However, this document does not answer the following:

-- Can NRIs keep money in a PO savings account, and if so is the interest taxable?
-- Can NRIs own National Savings Certificates, and taxability of that interest
-- Can NRIs have a Public Provident Fund, and taxability of that income

Also, it states in section 7.1.1 that interest on notified govt securities/bonds is not taxable -- which bonds are considered notified, how does one get a list?

Thank you again.
Logged
Pages: [1]   Go Up
  Print  
 
Jump to:  

Powered by MySQL Powered by PHP Powered by SMF 1.1.18 | SMF © 2006-2007, Simple Machines | Sitemap Valid XHTML 1.0! Valid CSS!