Professional Documents
Culture Documents
TDS Under Section 195
TDS Under Section 195
TDS Under Section 195
NRIs have to file tax returns for the income they earn in India.
They may also claim the withheld tax or TDS when filing tax
returns. For more on this, continue reading this article about
Section 195 TDS.
Table of Content
Who is a Non-Resident?
What is Section 195 of the Income Tax Act?
Threshold Limit to Deduct TDS u/s 195
Who is a Non-Resident?
NRI’s full form is Non-Resident Indian. It is a term applied to a
person who is not a resident of India as defined under Section
6 of the Income Tax Act. A person shall be a resident of India
if they stay in India for 182 days and above in any financial
year, 60 days and above in that year and 365 days and above in
the four preceding financial years. Anyone not complying with
these criteria is an NRI or non-resident Indian. NRIs hold an
Indian passport but have migrated to another country and work
there.
Conclusion
Section 195 of the Income Tax Act ensures that non-resident
Indians pay their taxes in India. To make it easier for
taxpayers and tax authorities, it mandates the deduction of
money from specified payments made to NRIs. It doesn’t
matter if they must carry the burden of compliance. If there’s
fairness and a way to prevent tax leaks, then we’re on the
right path. Ultimately, this makes collecting taxes from
nonresident taxpayers more efficient.