Let’s discuss the TDS on rent payable to NRI under section 195;
If you are an NRI receiving rent from property in India and TDS (tax deducted at source) has been withheld by your tenant, yes you can claim a refund, provided your actual tax liability is lower than the TDS deducted.
Here’s how it works: For rent paid to an NRI landlord, the tenant must deduct TDS under Section 195 of the Income-Tax Act.
The standard withholding rate is 30% (plus cess/surcharge), which effectively becomes 31.2%.
This applies regardless of rent amount which means even modest rent payments attract TDS if paid to an NRI.
However, actual tax liability may be lower because you are entitled to deductions: standard deduction under property income (like 30% for maintenance), interest on home loan (if applicable), municipal taxes, etc.
If after these deductions your total taxable income in India is below the basic exemption limit (currently Rs. 2.5 lakh under old regime or applicable new-regime threshold), then the TDS withheld was more than the tax due.
To claim the refund, you must:
Ensure the tenant gives you the TDS certificate (Form 16A).
Check that TDS shows up under your PAN in Form 26AS / AIS on the Indian Income Tax portal.
File your Income Tax Return (ITR) typically using ITR-2 (or other relevant ITR) as a non-resident.
Report rental income, claim deductions (standard deduction, loan interest, municipal taxes, etc.), and compute net tax liability. If that liability is lower than TDS already paid, you can claim a refund of excess TDS.
Also, if you expect your income to be below taxable limit for the year, you may apply for a nil / lower-deduction certificate under Section 197 which if granted, lets your tenant withhold TDS at a reduced rate (or nil) going forward.
This is all about the TDS on rent payable to NRI under section 195.
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Can NRI Claim TDS Refund on Rental Income?
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2025-12-08T10:15:59+00:00 2025-12-08T10:16:01+00:00Comment
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