Is long term gain from equity are taxable for NRI?
Resident Indian, Non-Resident NRE Trading and Non Resident NRO Trading are subject to Short Term Capital Gain( STCG) Tax , Long Term Capital Gain( LTCG) Tax and Business Income from Trading in Futures and Options. Rate of Tax is same for Resident, NRE and NRO.
Non Resident (whether NRE or NRO) are further subject to Withholding Tax requirement under section 195 of the Income Tax Act, 1961.
From 1st Feb2019, all long term capital gains resulting from the sale of equity investment on the recognised stock exchange are subject to Long Term Capital Gain( LTCG) Tax ( LTCG were exempt prior to this date). All Equity Investment held for more than 365 days are treated as long term when sold on the recognized stock exchanges and are subject to tax as per the following table:
| Particulars |
Rate of TDS |
Surcharge |
Health and Education cess @ 4% |
Effective Tax Rate |
| 1. Capital Gains on Equity Oriented Mutual Fund Units and Equity Shares sold on Recognized Stock Exchange and STT paid thereon: |
| i) Short Term |
15% |
2.25%* |
0.690% |
17.94%* |
| ii) Long Term |
10% |
1.50%* |
0.460% |
11.96%* |
| 2. Capital Gain on Debt Mutual Fund & listed securities other than (1) |
| i) Short Term |
30% |
11.10%** |
1.644% |
42.744%** |
| ii) Long Term |
20% |
7.40%** |
1.096% |
28.496%** |
| 3. Capital gain on Other Assets |
| i) Short Term |
30% |
11.10%** |
1.644% |
42.744%** |
| ii) Long Term |
20% |
7.40%** |
1.096% |
28.496%** |
| 4. Interest on Bank Deposits(NRO A/c) |
30% |
11.10%** |
1.644% |
42.744%** |
| 5. Income From Rent |
30% |
11.10%** |
1.644% |
42.744%** |
| 6. Royalty & Fees for Technical Service (FTS) |
10% |
3.70%** |
0.548% |
14.248%** |
| 7. Dividend on shares |
20% |
7.40%** |
1.096% |
28.496%** |
| 8. Dividend on units of mutual funds |
20% |
7.40%** |
1.096% |
28.496%** |
*Considering the surcharge as 15%.
**Considering the surcharge as per the highest rate of 37%.
DISCLAIMER:
This document should not be considered as substitute for specialized Professional advice and expert guidance should be sought before acting upon it.
