Determination of tax in special casesCentral
Section 216 of Income Tax Act 2025 in hindi
It shall not be necessary for a non-resident Indian to furnish a return of his income under section 263(1), if—
- (a)his total income during the tax year consisted only of investment income or income by way of long-term capital gains or both; and
- (b)the tax deductible at source under the provisions of Chapter XIX-B has been deducted from such income.
Summary
- Relieves non-resident Indians from the duty to file an income tax return in India under Section 263(1).
- This exemption applies only if their total income in the tax year consists strictly of investment income, long-term capital gains, or both.
- Requires that the proper tax has been deducted at source under Chapter XIX-B from all such income.
- Simplifies tax compliance for taxpayers whose tax liabilities have been fully settled through withholding taxes, meaning taxes taken out at source.
Practical examples
1Ramesh, an Indian citizen living in Sydney, earns only Rs. 2,00,000 as interest (investment income) from public company deposits in India during the tax year 2026-27. The Indian bank deducts the required tax at source under Chapter XIX-B. Under Section 216, Ramesh is completely exempt from filing an income tax return in India.
2Priya, a person of Indian origin living in Tokyo, makes a long-term capital gain of Rs. 4,50,000 from specified Indian bonds in November 2026, and the payer deducts tax at source under Chapter XIX-B. Since she has no other Indian income, she does not need to submit any tax return to the Indian tax department.
FAQ
1. Under which section of the Act is the general return filing obligation mentioned?
It is mentioned in Section 263(1).
Test yourself
Q1.Under Section 216, a non-resident Indian is exempt from filing an income tax return under which section?
Q2.What types of income are allowed for an NRI to be exempt from filing a return under Section 216?
Q3.Under which Chapter of the Act must tax be deducted at source for the Section 216 return filing exemption to be valid?