In which ITR Form NRIs need to furnish income tax return?

Updated: June 4, 2019 8:20:50 AM

A non-resident or a person not ordinarily resident in India, earning income in the form of salary and interest, is required to furnish return of income in India.

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By Chirag Nangia

I am an NRI since the last three years. My income is salary in present company in UAE (NRI), FD interest from saving account in India and FD interest in NRI saving account. What type of ITR do I have to file for last financial year (FY19)?
– Bibhakar Mishra
A non-resident or a person not ordinarily resident in India, earning income in the form of salary and interest, is required to furnish return of income in ITR-2 form.

ITR-1 form can only be used by an individual who is resident in India. Therefore, you have to furnish ITR-2 form this year also.

I had bought some shares more than thre years ago and would like to transfer them to my parent. Do I need to make a gift deed and necessarily register it?
—JJ Arora
In order to create a legal record, it is advisable to execute a gift deed on an appropriate stamp paper. You shall not be required to make any declaration in the ITR for making gift. The onus to make declaration in the ITR form is on the receiver of the gift under the head ‘exempt income’, since gift from a relative is exempt from taxation.

Tax liability shall be attracted when the shares are transferred by your parent. Moreover, the nature of capital gains shall be long term since the period for which the shares were held by you shall also be taken into consideration.

I am a senior citizen with income from bank FDs, family pension from EPFO, superannuation from LIC funded by my ex-employer who had purchased the annuity. Can I claim standard deduction of `40,000 for AY 2019-20 against the receipts of family pension?
—Arvind Kumar
Family pension is the amount of pension received by the family members of the employee in case of his death which is not a fact in your case. Therefore, we assume that amount of pension received by you is not family pension but a pension included under the salary provisions. If not specifically exempt under Section 10 of the Act, the same shall be charged to tax as salary under Section 17.

Similarly, the amount received as annuity from an approved superannuation could be exempt under Section 10. Standard deduction of Rs 40,000 can be claimed only out of salary income. Thus, you would be allowed deduction up to Rs 40,000 or the amount of salary, whichever is less. The amount of such deduction has been increased to Rs 50,000 with effect from FY20.

(The writer is director, Nangia Advisors LLP. Send your queries to fepersonalfinance@expressindia.com)

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