As an NRI in the United Arab Emirates, you're exempted from taxes and not mandatorily required to pay any taxes in India based on your income in the UAE. However, you are required to file an ITR and pay tax on any income you receive from assets in India. That being said, it is very common for NRIs to miss the deadlines related to NRI tax payments India while living in UAE
Missing the deadline may result in hefty penalties that directly impact your creditworthiness. For this, we've written an article that will help you learn everything about NRI tax payments in India.
What is the Tax Filing deadline for NRIs living in the UAE?
As for the residents of India, NRIs are also required to file their ITRs (Income Tax Returns) by July 31st of the assessment year. However, you can file the belated ITRs till 31 December of the assessment year with late fees.
The tax filing dates can change. Hence, it is always a better idea to check the official website of the Income Tax Department, and search for NRI tax payments in India, to obtain the most up-to-date information. For instance, the ITR for FY 2023-24 (AY 2024-25) must be filed by July 31st, 2024.
Consequences for Missing NRI Tax Payment Deadlines
Here's what you might end up facing if you do not make the NRI income tax payments as per the required deadline.
Penalties: Not filing the ITRs on the required deadline may trigger NRI tax payment penalties of up to INR 5,000 u/s 234F if income exceeds INR 5 lakh. Income lower than this threshold may levy only an INR 1000 penalty. You will also have to pay an interest and lose certain benefits that you generally receive for filing the returns on time.
Prosecution: In case of a significantly higher tax amount, you may even face prosecution.
Interest: Under Section 234A, the tax department may impose a monthly tax of 1% for late filing of the NRI income tax payments. For instance, if you were supposed to file taxes on July 31st, 2024, but you submitted it in December, you may have to bear a 1% interest rate for each month over your unpaid taxes.
Ways to Avoid NRI Tax Payment Penalties
To avoid NRI tax payment penalties, you must follow certain proactive measures.
1. Stay Informed on Tax Laws
Staying updated on the recent tax laws may allow you to be aware of any changes related to the deadline for NRI property tax payments or any other income you earn in India. Plus, it will allow you to take advantage of deductions, exemptions, and benefits.
2. Organize Financial Records
Maintaining simplified and organized tax documentation enables you to keep your ITRs ready to submit before the required deadline. In this way, you reduce your chances of missing the deadlines and, therefore, avoid potential penalties.
3. Seek Professional Guidance
Seeking a tax professional's guidance will keep you protected from missing deadlines and facing penalties. They have a good knowledge regarding NRI GST payments and NRI TDS payments, and will allow you to be compliant with the legal regulations.
4. Leverage Digital Tools and Services
In today's modern era, you must adopt technological solutions to increase the efficiency and accuracy of your documents. Use specialized NRI tax payment portals (like ClearTax, Income Tax Department Portal, Indian Bank Portals) to pay your taxes and file returns in a timely manner.
5. Set Reminders
You may even create a reminder on your mobile phone or calendar to start collecting your essential documents at least a month before the official deadline.
NRI Tax Payments India, Unlocked
Non-Resident Indians (NRIs), living in the UAE, are completely exempted from taxes in the United Arab Emirates. However, they must follow the Indian taxation system, especially if they receive any income from an Indian source.
The Indian Income Tax Department has defined certain specific deadlines for NRI income tax payment, requiring you to mandatorily follow them to avoid penalties and legal consequences. You can even connect with the government NRI tax payment customer support team to quickly resolve any queries.
Read more about the Indian tax system for NRIs and get other information on everything related to finance, savings, investment, lifestyle, events, and more. Subscribe to Belong - a platform that connects Indians living in the UAE with everything that happens back home!
