Does my tenant have to deduct tax on my rent?
Where the owner is a non-resident, the obligation sits on the tenant, and it applies to an individual tenant just as it does to a company. That is where the system usually breaks down, because an individual paying rent to someone they think of simply as their landlord often has no idea the duty exists, and does not hold the registration needed to remit the deduction. The consequence then lands on both sides. Raise it before the tenancy starts, in writing, because retrofitting it to a tenancy already running is much harder than setting it up correctly at the outset.
Why is tax deducted on the full rent, not my profit?
Because deduction at source is applied to the payment, and the payment is the gross rent. The deductions that reduce the taxable figure, being the municipal taxes you actually paid, the statutory allowance for repairs and the interest on a loan taken for the property, are all applied later, in the return. So the amount deducted routinely exceeds the tax the property actually owes, sometimes by a wide margin. That gap is not lost, but it comes back only by filing an Indian return and claiming it. A certificate obtained in advance authorising a lower deduction is what stops the gap opening at all.
Which expenses can I claim against Indian rental income?
The municipal taxes you have actually paid during the year, a statutory allowance for repairs and maintenance which is given whether or not you spent anything, and the interest on a loan taken to buy or construct the property. Notice what is not on that list. Individual repair bills, the managing agent's commission and the cost of a flight to inspect the place are not separately deductible, because the statutory allowance is given in place of the actual running costs. Keep the municipal tax receipts and the lender's interest certificate, as those are the two that need evidencing.
Do I have to file in India if tax was already deducted?
If you want the excess back, yes. The deduction is applied to the gross rent while the tax is computed on the net, so in most cases the amount deducted is larger than the liability, and the return is how that difference comes home. Filing is also what turns a deduction into a final tax figure, which matters for the credit you claim at home. Treating the deduction as the end of the Indian story is the most expensive assumption an owner makes, because money left unclaimed stays with the department indefinitely.
Can I claim a credit at home for the Indian tax?
Usually, but for the tax finally payable in India rather than for the amount deducted from the rent. If a large part of the deduction is recoverable and you never file to recover it, the unclaimed portion is not Indian tax you bore. It is money you left behind, and your home country will not give you credit for it. The credit is also capped by the home tax on that same income, computed under home rules and on a calendar year. So the Indian return, the home return and the credit claim really have to be built together.
How do I report Indian rent when the tax years differ?
India's year runs April to March while your home return is drawn to the calendar year, so the two never align. The income goes on the home return for the calendar year in which it arose, which means splitting the Indian year across two home returns and, conversely, pulling parts of two Indian years into each home one. Do the work from the monthly rent records rather than from the totals on the Indian return. The credit then has to be matched to the income it relates to, and that is the part most reconstructions get wrong.
Are US-listed ETFs US-situs property for a non-resident's estate?
Shares issued by a US company are generally US-situs for estate tax purposes, and a fund domiciled in the United States is a US company however global its holdings. A fund domiciled elsewhere that holds the same underlying stocks generally is not. That distinction — the domicile of the wrapper rather than the location of the investments — is why cross-border portfolios get restructured, and it should be confirmed against your own holdings before anything is sold. See US estate tax exposure for Canadians.
What is a DTAA?
Double Taxation Avoidance Agreement — India's name for a tax treaty. It does the same work as any treaty: allocates taxing rights between India and the other country, caps Indian withholding on payments abroad, and sets out whether relief comes by exemption or by credit. To use one you generally need a tax residency certificate from the other country, Form 10F, and a PAN in the deductor's records. See DTAA relief between India and Canada.
