Key points for NRIs filing for AY 2026-27 (FY 2025-26)
- Tax Garden's fee is ₹4,000 for ITR-2 and ₹5,000 for ITR-3, confirmed before we start.
- Filing is mandatory if total income in India exceeds ₹4 lakh (new regime) or ₹2.5 lakh (old regime), or if your TDS for the year is ₹25,000 or more.
- Rent and NRO interest paid to an NRI carry TDS at 31.2% (30% plus 4% cess). Filing a return is the only way to get any excess back.
- The original deadlines (31 July 2026 for ITR-2, 31 August 2026 for ITR-3) have passed. A belated return can be filed until 31 December 2026 with a late fee.
What NRI ITR filing costs
Tax Garden prices NRI returns by the ITR form, using the same fees as our ITR filing service:
| Return | Who it suits | Tax Garden fee |
|---|---|---|
| ITR-2 | NRIs with rent, NRO interest, dividends, capital gains on shares, mutual funds or property, or salary for work done in India | ₹4,000 |
| ITR-3 | NRIs with business or professional income in India | ₹5,000 |
The fee is confirmed before we start. Fees elsewhere vary a lot, so when you compare quotes, check what each one includes.
What makes an NRI return more work
| Factor | Why it adds work |
|---|---|
| Residential status near the limit | Days in India have to be counted from passport stamps for the year and earlier years (see below) |
| Property sale | Capital gain computation, matching buyer TDS, and any Section 54 or 54EC exemption |
| Treaty (DTAA) rate claim | Tax Residency Certificate, Form 10F, and checking the treaty rate for each income |
| Several income sources | Each source (rent, NRO interest, dividends, mutual funds) has its own TDS entries to match |
| TDS mismatch | A tenant or bank that deducted TDS but did not file its TDS return, so the credit is missing in Form 26AS |
A property sale also usually needs work before the sale: applying for a lower TDS certificate so the buyer does not deduct tax on the full price. That is a separate job from the return. Our guide on NRI capital gains tax explains how it works.
Who must file for AY 2026-27
| Situation | Must you file? |
|---|---|
| Total income in India above ₹4 lakh (new regime) or ₹2.5 lakh (old regime), counted before Chapter VI-A deductions and capital gains exemptions such as Section 54 | Yes |
| TDS and TCS for the year add up to ₹25,000 or more (Rule 12AB) | Yes |
| Income below the limit, but TDS was deducted and you want it back | Not mandatory, but filing is the only way to get the refund |
| You want to carry forward a capital loss or business loss | Yes, by the original due date |
| Income below the limit and no TDS | Generally no |
NRIs do not get the Section 87A rebate, which is only for residents. The basic exemption limit of your chosen regime still applies to normal income such as rent and interest.
Why most NRIs end up with a refund
Indian payers deduct TDS from an NRI under Section 195, and there is no minimum amount below which it stops. For rent and NRO interest paid in FY 2025-26, the rate is 30% plus 4% cess = 31.2% (surcharge is added only if income exceeds ₹50 lakh). This TDS is worked out on the gross amount, but your actual tax is worked out on taxable income after deductions and slab rates. The gap often comes back as a refund.
Example (new regime, FY 2025-26): an NRI receives rent of ₹30,000 a month and ₹50,000 interest on an NRO fixed deposit.
| Item | Amount |
|---|---|
| Annual rent | ₹3,60,000 |
| TDS on rent at 31.2% | ₹1,12,320 |
| Less 30% standard deduction under Section 24(a) | ₹1,08,000 |
| Income from house property | ₹2,52,000 |
| NRO FD interest | ₹50,000 |
| TDS on interest at 31.2% | ₹15,600 |
| Total income | ₹3,02,000 |
| Tax (below the ₹4 lakh basic exemption limit) | Nil |
| Refund on filing ITR-2 | ₹1,27,920 |
Here filing is also mandatory, because the TDS of ₹1,27,920 is above ₹25,000. Without a return, the full amount stays with the government.
From 1 April 2026, this TDS is deducted under Section 393(2) of the Income-tax Act, 2025 instead of Section 195, but the return for FY 2025-26 is still filed under the 1961 Act.
How the filing process works
1. Fix your residential status. Under Section 6, you are resident if you were in India for 182 days or more in the year, or 60 days in the year and 365 days in the four years before. For an Indian citizen or person of Indian origin visiting India, the 60 days becomes 182 days, or 120 days if Indian income (other than foreign-source income) is above ₹15 lakh. An Indian citizen with Indian income above ₹15 lakh who is not liable to tax in any other country is deemed resident. Our guide to NRI residential status and DTAA covers each test, and the RNOR guide covers returning NRIs.
2. List your Indian income. Rent, NRO interest, dividends, capital gains, and salary for work done in India are taxable. Interest on NRE and FCNR accounts is exempt while you are a non-resident. See NRE, NRO and FCNR tax rules.
3. Match TDS with Form 26AS and AIS. Every TDS entry from tenants, banks and buyers is checked against the income you report.
4. Apply the treaty rate where it is lower. For income up to 31 March 2026, you need a Tax Residency Certificate from your country of residence and Form 10F filed online on the income tax portal. For income from 1 April 2026, Form 10F is replaced by Form 41. Country guides: India-UAE DTAA and India-UK DTAA.
5. Choose the form. ITR-2 for most NRIs, ITR-3 if you have business or professional income in India. ITR-1 and ITR-4 are only for residents. Our ITR-2 guide for AY 2026-27 explains the schedules.
6. File and verify within 30 days. Verify with Aadhaar OTP, net banking, a bank account EVC, a digital signature, or by posting the signed ITR-V to CPC Bengaluru. A return not verified within 30 days of filing is treated as filed on the date of verification.
7. Track the refund. The refund goes to a pre-validated Indian bank account, such as your NRO account. There is no fixed timeline. CPC has until nine months from the end of the financial year in which you file to process the return, and a delayed refund earns interest under Section 244A at 0.5% per month.
Documents to keep ready
| Document | Used for |
|---|---|
| PAN | Filing and refund |
| Passport pages with entry and exit stamps | Day count for residential status |
| Form 16A from tenants, banks and buyers | TDS credit |
| Form 26AS and AIS | Matching TDS and income |
| Rent agreement and municipal tax receipts | House property income |
| Home loan interest certificate | Section 24(b) deduction |
| Indian bank statements (NRO, NRE, FCNR) | Interest income and refund account |
| Capital gains statement, sale and purchase deeds | Shares, mutual funds or property sold |
| Tax Residency Certificate and Form 10F | Treaty rate claim |
Mistakes we see in self-filed NRI returns
| Mistake | What happens |
|---|---|
| Wrong residential status | Foreign income taxed in India, or Indian income left out |
| Not filing at all | TDS refund lost, and filing may have been mandatory anyway |
| Reporting NRE interest as taxable | Tax paid on income that is exempt for a non-resident |
| Treaty rate claimed without TRC and Form 10F | Treaty rate can be denied (Section 90(4)), leaving tax at the domestic rate |
| Indian bank account not pre-validated | Refund fails to credit |
| Claiming Section 87A or resident-only deductions | Demand raised when CPC processes the return |
| Missing the due date with a capital loss | Loss cannot be carried forward |
Form 67 (foreign tax credit) and Schedule FA (foreign assets) apply to residents, not to NRIs. If the day count makes you a resident for the year, both may apply. See our Form 67 guide.
Missed the deadline?
The AY 2026-27 due dates were 31 July 2026 for ITR-2 and 31 August 2026 for ITR-3 (non-audit). You can still file a belated return under Section 139(4) until 31 December 2026:
- Late fee under Section 234F: ₹5,000, or ₹1,000 if total income is up to ₹5 lakh.
- Interest under Section 234A: 1% per month on unpaid tax, if any.
- Losses: capital and business losses cannot be carried forward in a belated return. A house property loss can.
If you are due a refund and have no unpaid tax, the 234A interest does not arise, but the 234F fee still applies if you were required to file (for example, because your TDS was ₹25,000 or more). More in our guide on filing ITR after the deadline.
How Tax Garden helps
We work out your residential status from your travel dates, match every TDS entry with Form 26AS and AIS, apply treaty rates where your documents support them, and file ITR-2 or ITR-3. If you are planning a property sale, we can also help with the lower TDS certificate before the sale. Start with our ITR filing service or see pricing.
Tax rules change. Check incometaxindia.gov.in before acting. This article is general information, not advice for your specific case.
