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Non resident indian taxability

Zakariya Wangde (Articled assistant) (56 Points)

28 November 2011

what is the taxabilty of non resident indian? Will the interest recieved on NRE account will b taxable? and what about interest recieved on saving account? Note that that the bank accounts are maintained in India.. i.e NRE a/c n saving A/c.

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Z ( ) (2965 Points)
Replied 28 November 2011

According ot sec 5 following is covered in total income of NRI for tax purpose

Income received or deemed to be received in India and

Income which accrues/arises or deemed to be accrues/arises in India.

Nature of interest has not been mentioned in the post. Some interest are not included and some interest income are included depending upon the the facts mentioned in following provision.Also reffer to 10(4)(ii) for income not to be included in total income.

According to the provisions of sec 9 (1)(v) , for determining whether interest shall be deemed to accrue or arise in India , it shall be considered whether the interest was received by the govt. or resident or non resident.

If paid by Govt. then it shall be deemed to accrue/arise

if paid by resident , then it shall be deemed to accrue/arise except interest is payable in respect of any money borowed and used for the purpose of business or profession carried outside India or earning income from any source outside India

If paid by NRI , it shall be deemed to accrue/arise ONLY IF interest is payable in respect of any money borowed and used for the purpose of business or profession carried IN INDIA.

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