Ans.
An NRI has to compulsorily file his
ROI in India when:
·
Taxable
income*in relevant FY (April to March) exceeds Basic Exemption
Limit i.e. Rs. 2,50,000/- for FY 2019-20or
·
Where taxable income* is less than Basic
Exemption Limit but the NRI:
i.
has STCG on Equity Shares/ Units of Equity
Oriented Mutual Funds/ Units of Business Trust; or
ii.
has any LTCG chargeable to tax; or
iii.
has deposited an amount or aggregate
of the amounts exceeding Rs. 1 crore in one or more current account maintained
with a banking company or a co-operative bank; or
iv.
has incurred expenditure of an amount
or aggregate of the amounts exceeding Rs. 2,00,000/- forhimself or any other
person for travel to a foreign country; or
v.
has incurred expenditure of an amount
or aggregate of the amounts exceeding Rs. 1,00,000/- towards consumption of
electricity; or
vi.
fulfils such other prescribed
conditions, as may be prescribed.
Categories
iii to vi above have been incorporated recently under the Income-tax Act, 1961.
So, individual’s need to check as to whether do they satisfy the said
conditions and if they satisfy, then they are also required to incorporate the
details as regard to amount of deposits in current account, foreign travel
expense, electricity charges, etc while filing their ROI.
However, NRIs havingspecific sources
of income like income from dividends, royalties, fees for technical services
etc. on which appropriate taxes have been deducted and other prescribed
conditions are satisfied, may not be required to file ROI in India. (refer FAQ
on ‘Special Provisions relating to taxation of income of NRIs’)
(ROR having
assets / signatory authority outside India as a beneficial owner or has
beneficiary interest in any asset outside India is mandatorily required to file
ROI even if their income is below the Basic Exemption Limit)
*Taxable income
for the purpose of filing ROI means gross total income before giving effect to
exemption on re-investment of capital gains (refer FAQ on ‘Capital Gains on
sale of immovable property and Securities’) and Chapter VI-A deductions (refer
FAQ on ‘Deductions from Gross total income’) i.e. donations, investment life
insurance policy/ Unit Linked Insurance Policy/ Equity Linked Savings Scheme,
mediclaim expenses, etc.
The
aforesaid conditions are duly explained through examples in below, for the
Reader’s ready reference and ease in understanding
a. Mr.
B has following income in India during FY 2019-20.
Nature
of Income
|
Amount
|
Amount
|
IFOS
|
2,10,000.00
|
2,10,000.00
|
LTCG
|
1,20,000.00
|
|
Less: Re-investment
|
(1,20,000.00)
|
-
|
Gross Total Income
|
|
2,10,000.00
|
Less: Deduction under Chapter VI-A
|
|
-
|
Net Total Income
|
|
2,10,000.00
|
Is
Mr. B liable to file ROI in India for FY 2019-20?
Yes,
Mr. B would be liable to file ROI in India for FY 2019-20. Since, even though
his Net total income i.e. Rs. 2,10,000/-is
below exemption limit of
Rs. 2,50,000/-,his taxable income i.e. gross total income before giving effect toExemption
on re-investment of Capital Gains(i.e. Rs. 3,30,000/-) is above basic exemption
limit.
b. Mr.
C has following income in India during FY 2019-20.
Nature of Income
|
Amount
|
IFOS
|
2,10,000.00
|
LTCG
|
-
|
Gross Total Income
|
2,10,000.00
|
Less: Deduction under Chapter VI-A
|
(50,000.00)
|
Net total Income
|
1,60,000.00
|
Is
Mr. C liable to file ROI in India for FY 2019-20?
No, Mr. C is not liable to
file ROI in India for FY 2019-20 as his Taxable income i.e. Gross total income
before giving effect of Chapter VI-A deduction (i.e. Rs. 2,10,000) is below
basic exemption limit of Rs 2,50,000/-.
c.
Will
the answer to above FAQ change if; Mr. C has incurred
Rs. 1,50,000/- towards consumption of electricity during said FY?
Yes,
Mr. C in the above example will be liable to file ROI in India for FY 2019-20.
Since, even though his taxable income i.e. gross total income is below basic
exemption limit of Rs. 2,50,000/-, he has incurred expenditure of more than
Rs. 1,00,000/- towards consumption of electricity during said FY and therefore,
Mr C will be required to file ROI in India.