How tax on rental income works for NRIs?

• June 6, 2023
• CA Chandan Agarwal's Office

Rental income from the property situated in India is taxable in the hands of the owner of the house property, whether it is for an NRI or a resident Indian.

How is income from house property taxed in India for NRIs or non-resident Indians? Are there any distinct regulations that NRIs must adhere to, and what is the procedure for calculating taxable income from house property for NRIs?

There are no separate rules for taxation of house property in India for residents and non-residents. Taxation rules are the same for both type of residency status. Rental income from the property situated in India is taxable in the hands of the owner of the house property, whether it is for an NRI or a resident Indian. The method of computing taxable rental income is prescribed under the income tax law as follows:

Gross annual value (GAV) less municipal taxes actually paid gives the net annual value (NAV). Reduce the standard deduction of 30% of NAV and interest on housing loan from it, which will then be the taxable rental income.

Source: https://www.livemint.com/money/personal-finance/taxation-of-house-property-for-nris-in-india-regulations-calculation-and-deductions-explained-by-ey-tax-partner-11685987590227.html