Definition of TDS
TDS stands for tax deducted at source. As per the Income Tax Act, any company or person making a payment is required to deduct tax at source if the payment exceeds certain threshold limits. TDS has to be deducted at the rates prescribed by the tax department.
TDS Provision For NRI
TDS on Interest on Non-Resident Ordinary Account (NRO) is of 30% . No TDS on Interest earned on Non-Resident External (NRE) accounts and Foreign Currency Non-Resident (FCNR) accounts. TDS on Rent House Property or other Rent & Commission / Brokerage or any other Income is 30% NRI Investments in Shares / Mutual Funds attract TDS and below are the TDS rate applicable on MF redemptions by NRIs for FY 2019-20. TDS on Dividend is exempted if DDT is paid. Tax Deducted at Source (TDS) Rates for NRI Mutual Fund Investors for 2019-20 Under Sec.195, when an NRI sells a property, the buyer is liable to deduct TDS @ 20% on Long Term Capital Gains. In case the property has been sold before 2 years (reduced from the date of purchase), a TDS of 30% shall be applicable (on Short Term Capital Gains)
TDS PROVISONS APPLICABLE TO NON RESIDENT INDIANS (NRI)
The below areas deals with TDS applicable to NRI. The following sections of the Act deal with deduction of tax at source from the payments made to Non-Residents and Payment to Foreign Companies for specific payments as detailed below.
