Is an NRI will be subject to capital gains tax if I sell a flat that I own in India?

Yes, capital gains on investment in shares and securities of India will be taxable in India. For example, if a house is sold and receives a long-term capital gain, the purchaser will deduct TDS at 20%.

What is the Double Taxation Avoidance Agreements (DTAA) role here?

According to provisions of income tax laws, an NRI can avoid double taxation by seeking relief under the provisions of Double Taxation Avoidance Agreement (DTAA) between the two countries.
Under the provisions of DTAA, there are two ways to claim relief of tax exemption: Exemption Method and Tax Credit Method. With the application of the exemption method, if NRIs are taxed in a single country, they can be exempted in another. Under the tax credit method, when the income is taxed in both countries, relief of tax can be claimed in the residence country.

Should taxes be deducted when payments are being made to NRIs?

A tenant of an NRI, while paying rent, must deduct TDS at 30%. The income can be received in an Indian account or in an account of another country’s bank account of the NRI in which he is currently staying.

When does an NRI file his income tax return in India?

An NRI must file his income tax return like any other Resident Indian in India if the total gross income received in India is more than Rs. 2.5 Lakh for the provided financial year. Further, 31 July is the due date for filing the income tax return for an NRI of the relevant assessment year, or the due date can also be extended by the Government of India.

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