Tax on investment income

The total income of an assessed, being a non –resident Indian, includes-

(a) Income from investment or income from long-term capital gains of an asset other than a specified asset,

(b) Income by way of long-term capital gains,

The tax payable by him shall be the aggregate of-

The amount of income–tax calculated on the income in respect of investment income referred to in tax exemption under 80g included in the total income at the rate of twenty percent.

The amount of income-tax calculated on the income by way of long term capital gains referred to the total income, at the rate of ten percent.

The amount of income –tax with which he would have been chargeable had his total income been reduced by the amount of income referred to in 80g.

In the case of an assessed being a non –resident Indian, any long –term capital gain arise from the transfer of a foreign exchange asset within a period of six months after the date of such transfer, invested the whole or any part of the net consideration in any specified asset or in any savings or such savings certificates being the capital gain shall be dealt with in accordance with the cost of the new asset is not less than the net consideration in respect of the original asset , the whole or such capital gain shall not be charged or the cost of the new asset is less than the net consideration in respect of the original asset ,so much of the capital gain as bears to the whole of the capital gain the same proportion as  the cost of acquisition of the new asset bears to the net consideration shall not be charged.

The new asset is transferred or converted into money, within a period of three years from the date of its acquisition, the amount of capital gain arising from the transfer of the original asset not charged under tax exemption on the basis of the cost of such new asset as provided in tax exemptions as the case shall be deemed to be income chargeable under the head “Capital gains” relating to capital assets other than short –term capital assets of the previous year in which the new asset is transferred or converted into money.

Return  income not be necessary for a non-resident Indian to furnish his total income in respect of which he is assessable under this act during the previous year consisted only of investment income or income by way of long-term capital gains or both and the tax deductible at source under the provisions. where a person, who is a non-resident Indian in any previous year, becomes assessable as resident in India in respect of the total income of any subsequent year, he may furnish to the Officer a declaration in writing along with his return of income for the assessment year for which he is so assessable, to the effect that the provisions for continue to apply to him in relation to the investment income derived from any foreign exchange.

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