NRI Demat Account Opening Guide
India-specific preparation guide
NRI Demat Account Opening Guide needs current-law checks, portal verification, documents and a precise brief before you compare experts on WorkIndex.
Post Your Requirement - FreeNRI Income Tax Slabs & Mandatory Return Filing (AY 2026-27)
NRIs must file income tax returns in India if their gross Indian-sourced taxable income exceeds the basic exemption limit, or if they wish to claim TDS refunds.
| ITR topic | Tax rules for NRIs | Key requirement |
|---|---|---|
| Basic Exemption Limit | Rs. 2.5 Lakh under the Old regime, and Rs. 3 Lakh under the default New regime. | NRIs must pay tax on any income exceeding this limit. Slabs apply normally. |
| Section 87A Rebate Exclusion | NRIs are NOT eligible for the Section 87A rebate. | The zero-tax result up to Rs. 7 Lakh or Rs. 12 Lakh is only for resident individuals. |
| ITR Form Selection | ITR-2 is standard for NRI salary, property, and capital gains. ITR-3 applies if business/profession income exists. | NRIs are strictly barred from using the simplified ITR-1 form. |
| Taxable Income scope | Includes Indian salary, rent from property in India, NRO interest, and capital gains on Indian assets. | Foreign-sourced income is completely exempt from tax in India. |
Important compliance checks for NRIs
- Physical stay rules: Verify if stay in India was less than 182 days (and does not meet 60 days + 365 days test) to confirm NRI status.
- TDS on NRI Payments: TDS is deducted under Section 195 on all payments to NRIs (rent TDS is 31.2%, property sale TDS is 20.8% LTCG / 30.9% STCG on gross value).
- NRE/NRO Account Setup: Interest on NRE and FCNR accounts is tax-free in India. NRO interest is fully taxable and subject to 30.9% TDS.
- DTAA Claims: NRIs can submit a Tax Residency Certificate (TRC) and file Form 10F online to reduce Indian TDS rates under tax treaties.
Documents to prepare for NRI tax filing
- Passport copy showing all pages with entry/exit stamps.
- NRE and NRO interest certificates and Form 16A TDS certificates.
- Form 16 from Indian employers (if salaried in India).
- Demat capital gains statement and transaction summaries.
- Tax Residency Certificate (TRC) and Form 10F (for DTAA claims).
NRI Demat Account Opening Guide: year and source check
Last fact-checked: 18 June 2026.
AY 2026-27 means FY 2025-26 income and is filed under the Income-tax Act, 1961. Tax Year 2026-27 means FY 2026-27 income under the Income Tax Act, 2025. Do not mix the two.
Verify stay days, TRC validity, DTAA rates, NRO interest, and Form 15CA/15CB requirements against official CBDT guidelines, notifications, and portal utilities before taking a filing position.
FAQs
Does an NRI get the Section 87A rebate?
No. The Section 87A rebate (which provides zero tax up to Rs. 7 Lakh or Rs. 12 Lakh in the new regime) is only available to resident individuals. NRIs must pay tax if their income exceeds the basic exemption limit.
Which ITR form should an NRI file?
NRIs must use ITR-2 for salary, house property, capital gains, and other sources. If they have business or professional income in India, they must file ITR-3. NRIs cannot use ITR-1.
What are the criteria under which an NRI must file an ITR in India?
An NRI must file an ITR if their total gross income in India (before deductions) exceeds the basic exemption limit (Rs. 2.5 Lakh under the old regime, Rs. 3 Lakh under the default new regime for AY 2026-27), or if they want to claim a refund for excess TDS.