Does an NRI Need to File an ITR in India? Limits, Forms, Due Dates and Refunds
Many NRIs assume that because TDS has already been deducted, they do not need to file a return in India. Sometimes that is correct. Often it is not, and NRIs regularly lose refunds or get tax notices because of it. Here is a clear guide.
Which year is which? Income earned in FY 2025-26 (1 April 2025 to 31 March 2026) is reported in the return filed in 2026 (AY 2026-27) under the Income-tax Act, 1961. Income from 1 April 2026 falls under the Income-tax Act, 2025 and is reported for tax year 2026-27, with the return filed in 2027.
What income of an NRI is taxable in India?
Only income that is received in India or earned or arises in India. Common examples:
- Interest on NRO deposits (NRE and FCNR interest is exempt)
- Rent from property in India
- Capital gains on Indian property, shares and mutual funds
- Dividends from Indian companies
- Salary for work done in India
Foreign salary and foreign investment income of an NRI are not taxable in India.
When must an NRI file a return?
An NRI must file if:
- Total Indian income is above the basic exemption limit: ₹4 lakh under the new regime (the default) or ₹2.5 lakh under the old regime, before deductions.
- They have capital gains that are not fully covered by the special exemption below.
- They want to claim a refund of extra TDS. This is very common, because NRO interest and property sales attract TDS at high rates.
- They want to carry forward a loss (for example a capital loss or a house property loss).
Special exemption: an NRI whose only income is investment income or long-term capital gains under the special NRI provisions, with full TDS deducted, does not have to file. The Income Tax Department has confirmed this continues under the 2025 Act.
No ₹12 lakh “zero tax” for NRIs
The rebate that makes income up to ₹12 lakh tax-free under the new regime (section 87A, now section 156 of the 2025 Act) is available only to resident individuals. An NRI with ₹9 lakh of Indian income pays tax on it at slab rates. This catches many NRIs out.
Which ITR form should an NRI use?
| Situation | Form |
|---|---|
| Interest, rent, capital gains or dividends; no business income | ITR-2 |
| Income from a business or profession in India | ITR-3 |
| ITR-1 (Sahaj) and ITR-4 (Sugam) | Not available to non-residents |
Due dates for AY 2026-27 (FY 2025-26)
| Return | Due date |
|---|---|
| ITR-2 (most NRIs) | 31 July 2026 (passed) |
| ITR-3 without audit | 31 August 2026 (passed). The Finance Act, 2026 moved this date from 31 July |
| Audit cases | Extended by CBDT to 21 November 2026 |
| Belated return | 31 December 2026 |
| Revised return | 31 March 2027. The Finance Act, 2026 extended this from 31 December; a fee applies if you revise after 31 December |
Missed the July deadline? You can still file a belated return by 31 December 2026. A late fee applies (up to ₹5,000, or ₹1,000 if total income is ₹5 lakh or less), and some losses cannot be carried forward. If you already filed but made a mistake, you can revise the return up to 31 March 2027. After that, an updated return can be filed, but additional tax is payable.
Claiming your refund
- Make sure your PAN is active and your bank account is pre-validated on the e-filing portal.
- Check Form 168 (the Annual Information Statement, formerly Form 26AS / AIS). All the TDS deducted from you should appear there.
- Report income in the correct categories and claim credit for the TDS.
- If you are claiming a lower rate under a tax treaty (DTAA), keep your Tax Residency Certificate and file Form 41 (formerly Form 10F).
- E-verify the return within 30 days. Many refunds are held up only because the return was never verified.
Old regime or new regime for NRIs?
The new regime is the default. NRIs with few deductions usually pay less under it. Those with large old-regime deductions (80C investments, home loan interest on a let-out property, 80D) should compare both. Remember the special rates (for example 12.5% on LTCG and 20% on equity STCG) apply under both regimes.
Common mistakes
- Not reporting NRO interest because “the bank deducted TDS”.
- Filing ITR-1, which NRIs cannot use.
- Choosing the wrong residential status in the return (see the first article in this series).
- Not e-verifying the return, which means the refund never comes.
- Claiming the ₹12 lakh rebate as an NRI.
Frequently asked questions
Is NRE interest taxable?
No. Interest on NRE and FCNR accounts is exempt while you are a non-resident, as long as the FEMA conditions are met.
Can an NRI file an ITR without an Indian address?
Yes. A foreign address and an Indian or foreign phone number can be given.
I only have NRO interest with TDS deducted. Should I file?
If the TDS (about 31.2%) is more than your actual tax, filing gets you a refund. In many cases that is well worth doing.
Missed the July deadline or waiting on a refund? Garvita Jain & Co. files NRI returns from start to finish, including belated returns, refund follow-ups and treaty claims. Contact us here, or at contact@garvitajainandco.com or +91 98678 16597.
This article is general information based on the law as of October 2026 and is not professional advice.
Sources
Official
- Income Tax Department, Non-Resident FAQs (filing exemption, NRE interest, regime continuity)
- Income Tax e-filing portal
Professional / CA publications
- TaxGuru, AY 2026-27 ITR due dates under Finance Act 2026
- TaxHeal, CBDT extends tax audit and ITR due dates (AY 2026-27)
- Business Today, ITR filing rules revamped from 1 April 2026 (revised return window to 12 months)
- TaxGuru, Section 87A / Section 156 rebate
- TaxGuru, Form mapping (26AS → 168, 10F → 41)
- ClearTax, Income tax for NRIs