Non-Resident Indians face additional complexity of India’s income tax system; income tax rules for NRIs and residents differ in certain ways. Moreover, NRI investment in India is subject to stringent compliance requirements set by the RBI. Hence, Indians living away from their home country have a lot of expectations from the Union Budget 2023 for NRIs, such as termination of excessive TDS across asset classes, online KYC and NRI Demat account opening, helpline number to resolve NRI taxation and investment queries, etc. Here is what NRIs expect from the budget 2023.
What NRIs Expect from Budget 2023
More than income tax, NRIs feel harassed by excessive TDS across asset classes. At SBNRI, we speak to hundreds of NRI investors from across the world on a daily basis. We discovered NRIs face several problems when investing in shares, mutual funds, or properties located in India. Even after investing in these assets, they are required to pay TDS on income types for which resident Indians are exempt.
Budget 2023 is expected to improve NRI citizens’ experience in investing and filing tax returns in India.
Relief from Additional Tax Deductions
While interest earned in an NRE and FCNR accounts is tax-exempt in India, rules related to TDS are stringent. For payments made to NRIs, there is no threshold limit to deduct tax at source. NRIs may be required to pay TDS even for Rs. 1 income. Moreover, NRIs don’t get the same tax benefits as resident Indians.
NRIs are expecting clarity on tax compliances, including clarity on confusion around TDS, removal of additional TDS, return filing, etc.
Tax Filing and Compliance
NRIs are expecting the budget to make it easier for them to understand their taxation process, including digital methods for submitting all returns and forms, and simplification of the documentation required for NRIs to file their returns.
Ease of Investing in India by NRIs
NRIs who wish to invest in India may have to deal with cumbersome processes defined in FEMA guidelines. In other words, rules and regulations for NRIs to invest in the Indian market are more complicated. For example, to complete the KYC process to open a Demat account, or to get their documents attested they need to visit the Indian embassy/ consulate in their country of residence.
NRIs are expecting the Government of India to address these problems and provide some solutions for ease of compliance through digital means.
As the Union Finance Minister will present the Union Budget 2023 tomorrow, NRIs are keenly waiting to get many of their problems resolved.
Whether it is NRI investment or taxation in India, they have always been looked at with a layer of doubt and confusion. It’s time to go beyond that. You can get an investment advisory from experts at SBNRI and sort your NRI Investments in India. Contact us using the button below. To ask any question related to NRI investment in India, you can schedule a call by clicking the button below or download SBNRI App from the Google Play Store or App Store.