NRI ITR filing: mapping each investment class to an ITR schedule and TDS section

Assuming you are an NRI sitting down to file your Indian return for FY 2025-26, the tax question breaks into two parts. The first (what is the rate) is well covered in most filing-season guides. The second (where does each rupee actually go in the form, and which TDS section was the payer supposed to use) is where the return either matches AIS cleanly or throws a mismatch that invites a notice under Section 143(1) or, worse, a Section 148A reopening.

This is a map, not a rate card. For each common investment class, the note lists the ITR schedule the income lands in, the sub-schedule if there is one, the TDS section the deductor should have quoted, and the reconciliation line to check against AIS / Form 26AS before hitting submit.

1. NRE and FCNR deposits

NRE savings and NRE FD interest is exempt under Section 10(4)(ii) while the holder is a person resident outside India under FEMA. FCNR(B) interest is exempt under Section 10(15)(iv)(fa) for a non-resident, and the exemption extends to a Resident but Not Ordinarily Resident (RNOR) under Section 6(6).

Statutory basis Section 10(4)(ii) for NRE interest; Section 10(15)(iv)(fa) for FCNR interest ITR schedule Schedule EI (Exempt Income), row "Interest" TDS section None (banks do not deduct on NRE/FCNR while status is non-resident) AIS check AIS will still show the gross interest as "interest from deposit" from the bank

The disclosure in Schedule EI is not optional cosmetics. AIS captures the interest from the bank's SFT filing; skipping the exempt row leaves an unexplained gap between AIS and the return. Report gross, mark exempt, cite the section. That is the paper trail.

2. NRO savings and NRO fixed deposits

NRO interest is fully taxable in India as "income from other sources".

Statutory basis Section 5(2) (income received/accruing in India)

• Section 56 (income from other sources) ITR schedule Schedule OS (Other Sources), row "Interest , from deposit" TDS section Section 195 at 30% plus surcharge and cess (banks deduct at this rate for non-residents unless a lower-rate certificate under Section 197 or a DTAA-beneficial rate under Section 90 is on file) TDS schedule Schedule TDS-2 (TDS on income other than salary, deducted from non-residents) AIS check NRO interest + Section 195 TDS both appear; reconcile against bank's TDS certificate (Form 16A)

A common gap: a returnee who redesignated the account to resident status mid-year has both a Section 195 period and, subject to threshold (₹50,000 for individuals, ₹1,00,000 for senior citizens in AY 2026-27), a Section 194A period in the same FY. Both, when applicable, appear in AIS under separate sections. Report both in Schedule OS, and both TDS entries in Schedule TDS-2 with the correct section quoted per entry.

3. Listed equity, STCG and LTCG on shares and equity funds

The single largest source of NRI capital gains for most portfolios sits here. Post 23 July 2024 rates, per Section 111A (STCG) and Section 112A (LTCG):

STCG on listed equity / equity fund (STT paid) 20% LTCG on listed equity / equity fund (STT paid) 12.5% above ₹1,25,000

Where in the ITR:

Schedule CG Section A (short-term) sub-section A3 for 111A gains; Section B (long-term) sub-section B4 for 112A gains Schedule 112A Scrip-wise ISIN, acquisition cost, FMV as of 31 Jan 2018 (for pre-2018 acquisitions), sale consideration. Mandatory line-item disclosure. TDS section For an individual NRI, listed-equity capital gains generally do not attract TDS on the gain itself at the broker (STT is the collection mechanism). Section 196D is limited to FII/FPI securities income and does not cover capital gains. Dividends and buybacks have their own sections (see below). Surcharge cap 15% on 111A/112A gains regardless of income bucket

The 112A scrip-wise sheet is where most self-filed NRI returns break. The utility does not autofill it from the broker's P&L statement. Take the AY 2018-19 grandfathering worksheet from the broker or download the full 112A CSV from the demat account and map it row by row.

4. Debt mutual funds and other non-equity funds

For units acquired on or after 1 April 2023, gains on specified mutual funds (equity holding under 35%) are treated as short-term capital gains at applicable slab rates under Section 50AA regardless of holding period. For units acquired before 1 April 2023 and sold in FY 2025-26, LTCG treatment by holding period is still available, but post 23 July 2024 the LTCG rate is 12.5% without indexation.

Schedule CG Section A sub-section A5 for STCG on non-112A/111A capital assets Rate Slab rate on gains treated as STCG under Section 50AA for post-April-2023 acquisitions TDS section Section 196A at 20% (plus surcharge and cess) covers income in respect of units paid to a non-resident (distributions). Capital gains on redemption of units are NOT covered by 196A; they fall to be analysed under Section 195. TDS schedule Schedule TDS-2 DTAA overlay Some DTAAs give the residence country exclusive taxing rights on mutual-fund capital gains, so verify against your treaty before claiming treaty relief on Section 195 TDS at redemption (or on distribution TDS under 196A for the distribution stream)

If the DTAA route is on the table, the refund claim runs through the ITR with the TRC and Form 10F on file; the AO can and often does raise a query on the treaty-carve-out claim.

5. Dividends from Indian companies

Post the 2020 dividend regime change, dividends are taxable in the hands of the shareholder.

Schedule OS Row "Dividend income" (with quarter-wise breakup for advance tax interest computation under Section 234C) Statutory Section 115A specifies 20% as the domestic rate for non-residents on dividends from Indian companies; the DTAA rate applies under Section 90 if beneficial and treaty conditions are met TDS section Section 195 for dividend paid to a non-resident (Section 194 does not apply to non-residents; 194 is for residents only) Surcharge cap 15% on dividend income (same carve-out as equity LTCG/STCG) TDS schedule Schedule TDS-2

The Section 195 versus Section 194 point catches out several NRI shareholders whose companies deducted at 10% under Section 194 (the resident rate) because the DP had a stale KYC status. That is a wrong-section TDS entry in AIS. Credit is usually still claimable in the ITR if the TDS is reflected against the PAN in Form 26AS; a deductor rectification is preferable for clean reporting, and a Section 197 lower-deduction route is worth setting up for the following year.

6. Rental income from Indian house property

Rental income from an owned Indian property is taxable in India regardless of residential status.

Schedule HP House Property, gross rent, municipal taxes paid, 30% standard deduction under Section 24(a), interest on housing loan under Section 24(b) TDS section Section 195 at 30% plus surcharge and cess on gross rent paid to a non-resident landlord. NOT Section 194-IB, which applies only when the landlord is a resident. TDS schedule Schedule TDS-2 Form The tenant needs a TAN (not just a PAN) to deduct under Section 195 and file Form 27Q quarterly

The Section 194-IB versus Section 195 confusion is one of the most common tenant-side errors on NRI-owned rentals. If the tenant deducted under 194-IB, the TDS shows up under the wrong section in the landlord's AIS. Report the rent in Schedule HP, claim the TDS in Schedule TDS-2 under the section actually quoted by the tenant, and separately raise the section-mismatch with the tenant so future quarters are corrected.

7. Sale of Indian house property

Capital gains on sale of Indian immovable property by an NRI trigger their own TDS regime under Section 195 read with Section 194-IA (which is buyer-side for residents only; buyers of NR-owned property fall under 195).

Schedule CG Section B for long-term (holding > 24 months) at 12.5% without indexation for transfers on or after 23 July 2024 (Finance (No. 2) Act 2024 amendment to Section 112); the 20% with indexation option was reinstated by later amendment for resident individuals on pre-23-July-2024-acquired property, so verify the current position for NR sellers, since the reinstated indexation option is structured as a resident-only relief TDS section Section 195 applies. For LTCG property sales in FY 2025-26, buyers commonly withhold with reference to the 12.5% long- term rate (plus surcharge and cess), following the post 23-July-2024 Section 112 rate. STCG requires case-specific rate analysis at applicable slab / special rates. Where a Section 197 lower-deduction certificate is in place, the buyer deducts at the certified rate. Practical Almost every NRI property sale needs a Section 197 certificate, otherwise TDS is on gross consideration, not gain, and the refund cycle is 12-18 months Repatriation FEMA cap of USD 1 million per FY out of sale proceeds under FEMA (Remittance of Assets) Regulations, 2016 (Notification FEMA 13(R)/2016-RB), read with the RBI Master Direction on Remittance of Assets

The Section 197 lower-deduction certificate is the operational lever for anyone selling. Absent a Section 197 certificate (or a Section 195(2) chargeable-sum determination), buyers commonly deduct on the gross sale consideration, often several times the actual tax liability, and the seller carries a large refund receivable for a full assessment cycle.

8. RSU and ESOP: Indian-employer-granted vs foreign-employer-granted

For an NRI who was previously employed in India and holds RSUs / ESOPs from that Indian employer that continue to vest or become exercisable after departure, the perquisite element is taxable in India in the hands of the employee. ESOP perquisite is taxed at exercise / allotment under Section 17(2)(vi) read with Rule 3; RSU perquisite is taxed when shares (or the right thereto) are actually transferred or settled per plan mechanics. The employer deducts TDS on the perquisite under Section 192.

Schedule S Salary: perquisite value from RSU/ESOP vesting on Indian-employer grants Schedule CG Later sale of the vested shares: capital gain measured against the FMV on the vesting date (which was already taxed as salary) TDS section Section 192 at slab rates on the perquisite element, employer deducted

For a foreign-employer grant (US employer, US-listed shares) vesting while the taxpayer is a non-resident of India, the perquisite is generally not Indian-source and does not enter the Indian ITR. The confusion arises for a hybrid year with India-work-days during the grant-to-vest period, where an apportioned share is Indian-sourced and needs to be reported. This is cross-border CA territory; do not self-file this without help.

9. Reconciling with AIS / TIS / Form 26AS before filing

The e-filing portal now surfaces three parallel data feeds:

Form 26AS TDS/TCS credits (the "official" credit ledger) AIS Annual Information Statement: SFT-derived, includes NRE/NRO interest, dividends, MF transactions, high-value share transactions, foreign remittances (Form 15CA) TIS Taxpayer Information Summary: aggregated view

Material income and TDS items should be reconciled to AIS and Form 26AS before filing. AIS is a reconciliation aid, not the legal return of record, and can itself be incomplete or wrong; where AIS is off, document the reason and file accordingly. Every TDS entry in Schedule TDS-2 should match a Form 26AS row on PAN of deductor, section, and quarter. Unexplained mismatches are the single most common trigger for a Section 143(1) intimation.

Checklist of questions to take to a CA

1. For each income stream, confirm the ITR schedule and TDS section the payer actually used against the section that should have been used (particularly 194 vs 195 for dividends, 194-IB vs 195 for rent)
2. Whether any TDS entry needs a rectification request with the deductor before filing, or a Section 197 certificate for the next FY
3. For property sale, whether a Section 197 lower-deduction certificate is worth the effort against the cash-flow cost of gross-consideration TDS
4. DTAA overlay on debt-fund gains (Section 195 refund claim), dividend rate (Section 195 refund down to treaty rate), and equity gains under a treaty carve-out. TRC and Form 10F must be on file.
5. Schedule 112A scrip-wise sheet reconciliation against broker CSV
6. For any RSU/ESOP with mixed India/foreign vesting period, work through Rule 4 apportionment with the CA before filing

A note on what this is. This article is one returnee's working notes, not personalised advice. Numbers age. Rules change. The only person who can sign off on your specific case is a qualified cross-border chartered accountant looking at your full facts. Use this as a checklist of questions to take to that conversation, not as the answer.

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Sources:

• Income-tax Act, 1961 (full text): https://www.indiacode.nic.in/bitstream/123456789/2435/1/a1961-43.pdf
• Income-tax Department e-filing portal: https://eportal.incometax.gov.in/
• Income-tax Department portal (forms, instructions, FAQs): https://www.incometax.gov.in/iec/foportal/
• RBI Master Direction on Deposits and Accounts of Non-Residents: https://www.rbi.org.in/Scripts/BS_ViewMasDirections.aspx?id=10198
• Sections cited: Section 5(2), Section 10(4)(ii) and 10(15)(iv)(fa) (NRE/FCNR exemption), Section 17(2)(vi) with Rule 3 (perquisite valuation on RSU/ESOP), Section 24 (house property deductions), Section 50AA (debt-fund STCG treatment), Section 56 (other sources), Section 90 (treaty override), Section 111A (STCG on listed equity), Section 112 (LTCG on immovable property post 23-July-2024), Section 112A (LTCG on listed equity), Section 115A (special rates for non-residents), Section 143(1) (intimation), Section 148A (reassessment), Section 192 (salary TDS), Section 194 (dividend TDS: residents only), Section 194-IA (property TDS: resident sellers only), Section 194-IB (rent TDS: resident landlords only), Section 195 (TDS on payments to non-residents), Section 196A (TDS on income in respect of units paid to non-residents, i.e. distributions; capital gains on redemption fall under Section 195), Section 196D (TDS on FII income), Section 197 (lower-deduction certificate), Section 234C (advance tax interest): as in force with Finance Act 2024 and Finance Act 2025 amendments.