Filing an Indian tax return as an NRI

Are you an NRI for Indian tax?

India decides residence each financial year (April to March), and the rules are separate from FEMA’s banking definition.

• You’re resident if you spend 182 days or more in India in the year. A second test (60 days in the year plus 365 days over the previous four) does not apply to Indian citizens who leave India for work, so for most H-1B workers the 182-day test is the one that matters.
• If you visit India and your Indian income (not counting foreign income) is over ₹15 lakh, the 60-day test becomes 120 days.
• A citizen with more than ₹15 lakh of Indian income who isn’t taxed anywhere else can be a deemed resident. US residents are taxed in the US, so this rarely bites.
• When you move back, you’re usually resident but not ordinarily resident (RNOR) for a while, which keeps foreign income out of Indian tax for a few years.

Do you have to file?

You must file if your Indian income is above the basic exemption (₹4 lakh under the new regime for income earned April 2025–March 2026). The rebate that makes residents’ income up to ₹12 lakh tax-free is not available to NRIs.

You don’t need to file if your only Indian income is investment income or long-term capital gains with the correct tax already deducted. Many people file anyway, because NRO interest has tax deducted at 30% plus surcharge and cess, and filing is the only way to get back the excess.

Deadlines

• July 31: return due for most NRIs (no audit). Belated returns are accepted until December 31.
• Advance tax applies if you’ll owe more than ₹10,000 after tax deducted at source: 15% by June 15, 45% by September 15, 75% by December 15, all by March 15.

The new Income-tax Act (from April 1, 2026)

India replaced the 1961 Act with the Income-tax Act, 2025 from April 1, 2026, with new rules notified in March 2026.

• Income earned up to March 31, 2026 (the year you file for in July 2026) is still under the old Act.
• “Previous year” and “assessment year” become a single “tax year”.
• Section and form numbers changed. Examples: tax on payments to non-residents moved from section 195 to section 393; Forms 15CA/15CB for sending money abroad became Forms 145/146; PAN applications use Form 93 (Indian citizens) and Form 95 (foreign citizens, including OCI holders).
• Your CA’s software will handle this; you just need to recognise the new names on forms from your bank.

PAN, Aadhaar and KYC

• NRIs are exempt from linking PAN with Aadhaar. If your PAN shows as “inoperative”, update your residential status with the Income Tax Department: an inoperative PAN means refunds are held and tax is deducted at higher rates.
• Indian banks ask NRIs to update KYC periodically and to give a FATCA/CRS self-declaration of tax residence. Answer it: it’s how Indian banks report accounts of US tax residents to the IRS.

See also Aadhaar & PAN and US tax on Indian income.

Sources

1. Income Tax Department: Non-resident FAQ (residential status, s.115G / s.216)
2. Income Tax Department: Computation of tax for individuals (slabs, rebate, cess)
3. Income Tax Department: FAQs on the transition to the Income-tax Act, 2025
4. PIB: Income-tax Rules, 2026 notified
5. Income Tax Department: Linking PAN with Aadhaar FAQ (non-resident exemption)
6. Income Tax Department: Advance tax due dates

Rules change often. If something here looks out of date, it probably is; check the official source and talk to an immigration attorney about your own case.