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    Budget 2020: Government to tax Indian income of NRIs under new tax regime

    Budget 2020: Government to tax Indian income of NRIs under new tax regime

    Budget 2020: Government to tax Indian income of NRIs under new tax regime
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    By CNBC-TV18  IST (Updated)

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    Non-resident Indians not paying taxes in any foreign country will now be taxed under the new tax regime, sources privy to the developments told CNBC-TV18.

    The government is likely to clarify its intent and stand on the newly-proposed NRI tax soon, sources privy to the developments told CNBC-TV18. Non-resident Indians, who are not paying taxes in any foreign country, will now be required to pay the personal income tax in India under the new tax regime, according to the Budget 2020.
    At present, if Indians or people of Indian origin managed to stay in India such that he remained a non-resident in perpetuity, they were not liable to pay tax on his global income in India.
    Under the new tax regime, annual income up to Rs 2.5 lakh is exempt from tax. Those individuals earning between Rs 2.5 lakh and Rs 5 lakh will pay 5 percent tax. A 10 percent tax will be charged on income between Rs 5 and 7.5 lakh, 15 percent, 20 percent and 25 percent on next Rs 2.5 lakh each and 30 percent on income above Rs 15 lakh.
    The new income tax rates will, however, not allow exemptions under Section 80C. Home loan exemption, insurance exemptions, the standard deduction will also not stay under the regime.
    Tightening the residency provisions, the budget also proposed to reduce the period of stay in India to 120 days from 182 days earlier for persons of Indian origin (PIOs) to be categorised as non-resident Indians (NRIs).
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