There's no tax on sending money to India

Resident or Non-Resident, it makes no difference. We've seen this question asked so many times that we decided to write a small note on this.

Sending money into India is not taxed. India taxes income, not transfers. Moving your own savings into India is just moving money between your accounts. As long as the remittance itself is not income there is no tax on it.

That's it. That's the article :)

Okay, we'll also explain what Residential Status is and what income is taxed for Non Residents and RNORs

Residential status

Your status is decided each financial year (April–March) by the number of days you are physically in India:

• Non-Resident (NR):

  • Generally, less than 182 days in India in the year.

  • They were in India for 60 days or more during the financial year but less than 365 days across the four preceding financial years.

• Resident but Not Ordinarily Resident (RNOR):

  • resident, but NR in 9 of the last 10 years,

  • or in India for 729 days or less in the last 7 years.

  • Common for people who have just returned.

• Resident and Ordinarily Resident (ROR):

  • resident who does not qualify as RNOR.

Note: There are other 60 day and 120 day conditions but we've left them out for the purpose of this article to not complicate it.

The below chart should make it easier to understand

By the way, if you're planning to return to India from USA, October to January is usually the best time. More on that here.

Scope of income Your status decides which income India can tax:

Reyman Tips: This is also why Non Residents returning to India usually get an amazing period where they're not paying capital gains in any country. You should reset your cost basis and save on capital gains tax.

The bottom line:

Tax is triggered when you earn the income (based on your status that year) and not when you bring the money into India.