Budget 2023-24: NRIs Want Removal Of Excessive TDS, Not Reduction In Tax Rates (2) (2)

     5388   20 Mar, 2023 


A majority of non-resident Indians (NRIs) want reduction or removal of excessive tax deduction at source (TDS) across asset classes this Union Budget. A huge 92 per cent of those surveyed by Mudra Portfolio, a Mumbai-based global NRI and high networth individual (HNI) financial service management company, have said that they would prefer this over reduction in the tax rates. The reason they cited was that their tax liability was way less than the TDS, and so, removal of excessive TDS would ensure that they won’t have to wait till filing their returns to claim the excess tax deducted. At present, the TDS rate (excluding surcharges) for interest on non-resident ordinary (NRO) accounts and deposits is 30 per cent, while that on long-term capital gains (LTCGs) and short-term capital gains (STCGs) on equities are 10 per cent and 15 per cent, respectively. The TDS rate on STCGs from debt (non-equity) mutual funds is 30 per cent and the same on property sale (on the sale value), and rental income are 20 per cent and 30 per cent, respectively. The rate for dividend income is 20 per cent. According to the survey, TDS is considered a big dampener for NRIs while selling property. About 92 per cent of respondents stated that the 20-23 per cent TDS on property sales, and that too, based on sale value rather than capital gain, should be decreased. Obtaining the low TDS certificate from the income tax department takes a bit of time and effort, and purchasers rarely wait that long, the survey revealed. Nishant Kohli, founder director and business head-wealth, Mudra Portfolio, said they reached out to NRIs across 15 nations for the survey.


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