Double Taxation Avoidance Agreement (DTAA)
While NRO accounts are not exempt from tax, account holders can avoid paying double taxes, thanks to the Double Taxation Avoidance Agreement (DTAA). If you are an NRI, any income you earn in India will be taxed by the Indian government. However, you may also have to pay taxes on the same income in your country of residence. The Reserve Bank of India (RBI) has entered into a DTAA with several countries, as a result of which you can avoid paying double taxes.
As per the DTAA signed between India and several other countries, you only have to pay taxes once, at a rate fixed by the agreement. Therefore, if you as an NRI have earned income in India, the tax you have to pay will depend on the rates specified in the DTAA with the country in which you live currently.
India has entered into a DTAA with several countries where Indians are present in overseas. Here are the taxes you have to pay, according to the country you live in:
| Country (in alphabetical order) | DTAA TDS rate |
|---|
| Australia | 15% |
| Canada | 15% |
| Germany | 10% |
| Kenya | 10% |
| Malaysia | 10% |
| Mauritius | 10% |
| New Zealand | 10% |
| Oman | 10% |
| Qatar | 10% |
| Russia | 10% |
| Singapore | 15% |
| South Africa | 10% |
| Sri Lanka | 10% |
| Thailand | 25% |
| United Arab Emirates | 12.50% |
| United Kingdom | 15% |
| United States of America | 15% |
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