Interest On The NRE Deposits Is Taxable For Residents
Posted on September 30 2020
For an NRI, the interest earned on the NRE deposits is excluded from tax in India. As long as you continue to be an NRI or a resident but not ordinarily resident, the tax immunity will continue to apply for these deposits held by you.
An NRI will continue to be resident but not ordinarily resident for 2 years after their income tax return. The NRE accounts needs to be converted to Resident accounts upon change in the residential status.
When you become a Resident then the interest earned on the NRE accounts will be taxable for you. You will also need to disclose all the details of all your assets held abroad as well as disclose and pay the tax on the income you have earn abroad. Including the interest earned in the foreign bank accounts.
Tax Assistis a professional income tax consultancy in India for both corporate houses and individual tax payers; the latter comprising Salaried Individuals, Seafarers, Professionals and Non Resident Indians.
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