- He can transfer the amount to your NRO account. There would be no TDS on such amount.
- Tax would on rental income of Rs.20k.
TDS for a loan to a friend
I am an NRI - living and working in Dubai. I sent money to my NRE account and converted it into a fixed deposit. My friend needed some urgent cash for medical expenses. I broke the FD and gave him 7 Lakh INR. Now he wishes to return that amount to me in my NRO account through transfer or deposit. Will TDS be applicable for that transaction. Note: I also have few sources of income in that NRO account this year. I get a monthly rent of INR 20k and also another friend transferred 3Lakh INR to that account which he owed me earlier.
Asked 5 years ago in Income Tax
Dear Sir,
Hope you are doing well !!
-Yes, he can transfer the amount to your NRO account without any tds deduction.
-You will be liable to pay taxes on rental income.
Hello,
There won't be any tax deduction on the transfer of this amount to your NRO account.
Proper TDS deduction should be made by the tenant for the rent amount.
I hope that this answer satisfies your requirements.
Regards,
CA Hunny Badlani
If he is just repaying the loan without any interest then no TDS is required to be deducted.
For rent also you may apply for lower deduction and save TDS deduction as your income in India is below Rs. 2.5 lakh and then you would not be required to file income tax return.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you.
Hi
No. It shall not be liable to TDS. TDS is not applicable on transactions in the nature of loan.
Make sure you prepare proper documentation for the loan transaction.
Hello Sir,
There is no requirement of tds deduction for transfer the amount to your NRO account.
However, you need to pay the applicable taxes on rental income in India.
If you need any further assistance. please let me know.
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