NRIs, OCIs pensions to be taxed at source as per DTAA: Indian pension authority

The Pension Fund Regulatory Authority of India (PFRDA) has stated that pensions for Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs) will be taxed at the source in line with rates set in various Double Taxation Avoidance Agreements (DTAA). 

Under the new rules, any individual with a valid OCI card can open a Tier I NPS account.
Under the new rules, any individual with a valid OCI card can open a Tier I NPS account. Photo courtesy: Public Domain Pictures

India had earlier this year allowed OCIs to enrol in the National Pension Scheme (NPS) at par with NRIs. 

Under the new rules, any individual with a valid OCI card can open a Tier I NPS account. Both NRIs and OCIs are not allowed to open the Tier II NPS account. 

“Based on the communication received from Insurance Regulatory and Development Authority of India (IRDAI), it is hereby clarified that annuity payable by Annuity Service Providers (ASPs) to NRIs and OCIs will be taxed at source, at rates applicable as per the DTAA (Double Taxation Avoidance Agreements) of the country where the annuitant resides," the regulator said in a circular.

The PFRDA also directed the intermediaries to explain to prospective and existing subscribers that “Annuities payable to NRI/OCI are subject to TDS’ and repatriation of the corpus, if any will be subject to applicable laws and regulatory provisions of IRDAI/PFRDA/RBI”.

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CtoI News Desk
CtoI News Desk – CtoI

Singapore-headquartered online media company targeting Indian Diaspora across Singapore, US, UK and Dubai. Connected to India covers developments around Indians abroad, informing, engaging and entertaining its audiences.

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