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Yes, NRIs can invest in PMS in India. As per SEBI regulations, the minimum investment required is ₹50 lakh.
To invest in the Indian stock markets, NRIs need permission from the Reserve Bank of India (RBI). A designated PIS/Securities account is required for all secondary market transactions and must be linked to an NRE/NRO account.
DTAA helps NRIs avoid being taxed twice – once in India and again in their resident country.
How DTAA Works:
● India has DTAA agreements with many countries.
● If you pay tax on stock sales or dividends in India, you can reduce your tax in your resident country by presenting tax proof.
Benefits of DTAA for Equity Investments:
● Lower TDS Rates: Dividends and capital gains may attract lower TDS (10-15%) based on the DTAA agreement between India and your country.
● Avoid Double Taxation: If your country of residence taxes global income, you can avoid being taxed twice on the same income.
Example: If the DTAA agreement allows a 10% tax rate on dividends, TDS in India will be reduced to 10% instead of the standard 20%.
Income from the following is taxed-
● Dividends received
● Capital gains (short-term or long-term)
● TDS is applied when the income is credited to your account.
● If TDS is higher than your total tax liability, you can claim a refund by filing your income tax return.
● Taxation under the DTAA agreement with your country of residence may vary for each investor.
● It is recommended to consult a tax advisor for detailed guidance.