Numerous Indian citizens who live and work abroad prefer to maintain a physical presence in India by often visiting, knowing that they will never settle down there; thus, availing of the benefits offered by the country through paying advance tax on rental income or capital gains does not make much sense to them. However, if an NRI is aware that he/she might get into some kind of trouble with the Income Tax Department for avoiding taxes due under the provisions of Section 9(1)(i) of the income tax act can approach a tax consultant for NRI in Pune and consult on some procedures before leaving India upon which: 

  • It must be noted that every person has the right to choose whether or not he/she wants to avail of the tax benefits offered by the country. 
  • If NRIs do not pay advance tax (during the time when they are present in India), they must make sure to check their income tax returns at the end of each financial year. If any money due under the abovementioned provisions is left unpaid, it will be considered an offense, and one can be jailed for five years or fined, or both! NRIs should also know that advance tax should still be paid on rent/capital gains earned from immovable property owned in India, even if their return is self-assessed. 

NRI citizens who visit India frequently always need to provide evidence to support their claim that they were not physically present in India during a particular period. If the evidence provided is not satisfactory, the department will levy interest on unpaid income tax that one has to pay according to Indian laws. There may also be penalties levied on NRIs for unpaid taxes if caught by the Income Tax Department of India later. 

The NRI tax planning in Pune:

  • Advance Tax has to be paid by 15th of each quarter if the sum due was not yet deducted at the source. It must be noted that this provision does not apply to salaried people who have their salary or pension credited into their bank accounts in India. 
  • If one is an NRI citizen, make sure they report any money earned from rent/capital gains earned from immovable property in India by filing their income tax returns on time. One may even be required to attach the proof of advance tax paid if he/she claims that it has already been deducted at source by his/her landlord, etc.

The Income Tax Department of India has always remained vigilant when detecting tax evasion by NRIs, especially when it involves money earned in India. One should never take this lightly and always remember to pay advance tax on money earned in India by all means. 

If they are an NRI citizen living outside India, make sure they file their income tax returns as per the aforementioned provisions so that their taxes will not be considered unpaid. One should also attach proof of advance tax paid if they claim it has already been deducted at source by their landlord.

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