The Union Budget has proposed a five-year tax exemption on global income for non-resident experts, as the government seeks to attract overseas professionals to work in India for longer periods.
Under the proposal, the global income of a non-resident expert, income not sourced in India, will be exempt from tax in India for a period of five years. During this period, only income earned from Indian sources will be taxable in the country, irrespective of the length of the individual’s stay.
Eligibility linked to prior non-residency, government schemes
According to the budget, to qualify for the exemption, the individual must have been a non-resident for the five years immediately preceding their visit to India. In addition, the expert must be providing services under the notified government schemes.
Sitharaman said that this is aimed at providing tax certainty to global professionals, ensuring that their overseas income and assets remain outside the Indian tax net while they contribute their expertise domestically.
Separate relief for relocated NRIs via disclosure scheme
In a separate measure, the Budget has introduced relief for relocated NRIs through the Foreign Assets of Small Taxpayers – Disclosure Scheme (FAST–DS).
According to the budget, the scheme provides a one-time six-month window for small taxpayers, including relocated NRIs, to disclose previously misreported or undisclosed foreign assets or income below specified thresholds. Depending on the category, assets or income up to Rs 1 crore or Rs 5 crore, individuals can pay a prescribed tax or fee to receive immunity from penalty and prosecution.