NRI TDS Rates in India — Salary, Rent, Capital Gains, Bank Interest (2026)
NRI TDS rates India — salary (Section 192), and rent, capital gains, NRO interest and dividends under Section 195 (s.393(2) from April 2026). DTAA + 15CA/15CB.
TDS is deducted at higher rates for NRIs vs resident Indians. In this guide, we cover all the NRI TDS rates, DTAA relief, and how to claim lower / nil TDS.
Which section. Apart from salary (Section 192), almost every payment to a non-resident is covered by Section 195 of the 1961 Act, not the resident sections (193, 194, 194-I, 194-IA). For payments made from 1 April 2026 the Income-tax Act, 2025 applies: TDS on payments to non-residents sits in Section 393(2), and the lower-deduction certificate in Section 395 (Form 128, earlier Form 13). The rates below are before surcharge and 4% cess.
NRI TDS Rates (Section-wise)
| Section | Income Type | TDS Rate (Normal) | DTAA Rate (US / UK) |
|---|---|---|---|
| 192 | Salary (Indian employer) | Slab rate (as per ITR) | Varies (DTAA) |
| 195 | Interest on NRO FD / savings | 30% | 10% / 15% (US), 10% / 15% (UK) |
| 195 | Sale of property by an NRI seller | On the capital gain: 12.5% long-term, 30% short-term | Usually taxable in India under the treaty |
| 195 | Rent paid to NRI landlord | 30% | Usually taxable in India under the treaty |
| 195 | Dividend to NRI | 20% | 15-25% (varies) |
| 195 | Royalty / fees for technical services | 20% | Varies (DTAA) |
| 195 | Listed shares / equity MF gains | STCG 20%, LTCG 12.5% above ₹1.25 lakh | Usually taxable in India |
| 194B | Lottery / game show | 30% | — (no DTAA relief) |
| 194BB | Horse race winnings | 30% | — |
NRI Tax Rates on Different Incomes
1. Salary (Section 192)
TDS on salary is deducted by the employer at slab rates (same as residents). The employer can apply DTAA relief if the employee provides TRC + Form 10F. Otherwise, the employee claims refund by filing ITR.
2. Rental Income (Section 194-I)
Tenant deducts 30% TDS (plus surcharge and cess) under Section 195 on rent paid to NRI landlord, and needs a TAN to do so. Rent from Indian property is normally taxable in India under the treaties, so the practical relief is a lower / nil TDS certificate from the IT officer (Section 197 / 195(3); Section 395 and Form 128 from 1 April 2026).
3. Capital Gains on Property (Section 195)
The 1% TDS under Section 194-IA applies only when the seller is resident. When the seller is an NRI, the buyer must obtain a TAN and deduct TDS under Section 195 on the capital gain — 12.5% for long-term gains, 30% for short-term, plus surcharge and cess. Without a lower-deduction certificate, buyers often deduct on the full sale value. The NRI seller files an ITR to claim any refund.
4. Interest on NRO FD / Savings (Section 193)
Bank deducts 30% TDS (plus surcharge and cess) on interest paid to NRO account. For DTAA countries (US, UK, Singapore, etc.), reduced rate (10-15%) can be claimed by providing TRC + Form 10F.
5. Interest on NRE / FCNR (Section 193)
TDS not applicable on interest earned on NRE / FCNR deposits (NRE is fully repatriable and tax-free in India for the interest). FCNR principal + interest is also fully repatriable.
6. Dividend (Section 194)
Indian company deducts 20% TDS (plus surcharge and cess) under Section 195 on dividend paid to NRI shareholder. Reduced DTAA rate (often 10-15%) available on TRC + Form 10F.
7. Capital Gains on Indian Stocks / MF (Section 195)
Broker / MF deducts TDS on capital gains. For listed equity and equity funds transferred on or after 23 July 2024 the rates are: STCG 20% (Section 111A), LTCG 12.5% (Section 112A) on gains above ₹1.25 lakh a year. Most treaties leave share gains taxable in India.
DTAA — Double Tax Avoidance Agreement
India has DTAA with 90+ countries. Under Section 90(2) the lower of the treaty rate and the Act rate applies, if you give the deductor a TRC and Form 10F. The headline treaty rates below are indicative: the rate that applies depends on the article, the type of recipient and conditions such as beneficial ownership, so check the treaty text before relying on it.
| Country | Interest | Dividend | Royalty / Fees |
|---|---|---|---|
| USA | 10% / 15% | 15% / 25% | 10% / 15% |
| UK | 10% / 15% | 10% / 15% | 15% |
| Singapore | 10% / 15% | 10% / 15% | 10% |
| UAE | 5% / 12.5% | 10% | 10% |
| Canada | 15% | 15% / 25% | 15% / 20% |
| Australia | 15% | 15% | 15% |
| Germany | 10% | 10% | 10% |
How to Claim DTAA Relief
- Step 1: Obtain Tax Residency Certificate (TRC) from the country of residence
- Step 2: Provide TRC + Form 10F + self-declaration to the deductor (employer, bank, tenant, buyer)
- Step 3: Deductor applies DTAA rate while deducting TDS
- Step 4: File ITR in India (ITR-2 for non-business NRI, ITR-3 for business NRI)
- Step 5: Apply the treaty rate in the ITR (the DTAA columns of the income schedules) and keep the TRC and Form 10F on file
- Step 6: Claim credit for the Indian tax in your country of residence (Schedules FSI / TR are for residents and are not used by NRIs)
Lower / Nil TDS Certificate (Section 195 / 197)
If the TDS would be more than your actual Indian tax liability (for example because your income is below the basic exemption, or only the gain on a property sale is taxable), you can apply for a lower / nil TDS certificate from the IT officer. Application: Form 13 (Form 128 under Section 395 from 1 April 2026). Documents: PAN, Aadhaar, TRC, Form 10F, ITR history, foreign asset disclosure, computation of Indian income.
Form 15CB + 15CA — Foreign Remittance
- Form 15CB: CA certificate verifying the nature of remittance + DTAA applicability. Required for remittance > ₹5L.
- Form 15CA: Self-declaration by the remitter. Filed online on the IT portal.
- Required for most remittances to a non-resident (rent, dividend, capital gains, property sale, etc.); items on the exempt list in the rules do not need them
- From 1 April 2026 these are Form 145 (declaration) and Form 146 (CA certificate) under Rule 220 of the Income-tax Rules, 2026. See our Form 15CA/15CB filing service, from ₹2,199 per remittance.
Frequently Asked Questions
Q: Is NRI TDS higher than resident TDS?
A: Usually. Interest and rent paid to NRIs carry 30% TDS plus surcharge and cess (against 10% or 2% for residents), and property sales attract TDS on the gain at capital-gains rates instead of 1%. DTAA relief and a lower-deduction certificate can reduce it.
Q: How to reduce NRI TDS?
A: Three ways: (1) Apply for DTAA relief (provide TRC + Form 10F), (2) Apply for lower / nil TDS certificate (Section 197), (3) File ITR and claim refund of excess TDS.
Q: What if my NRI TDS is deducted at higher rate than DTAA?
A: File ITR and claim refund of the excess TDS. You can also provide TRC to the deductor before the FY ends to apply DTAA rate going forward.
Q: Is NRE account interest taxable in India?
A: No. Interest earned on NRE account is tax-free in India. Interest on NRO account is taxable at 30% (DTAA rate if applicable).
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