📋 NRI Tax · Step 3 of 5
DTAA · double-taxation treaties — how the US / UK / UAE treaties keep you from being taxed twice
India has DTAA treaties with 90+ countries that prevent the same income from being taxed in both. The US-India and UK-India treaties cover most diaspora situations — but you have to file the right forms (10F + TRC) to claim benefits.
AK
Amish says
Without filing Form 10F + a Tax Residency Certificate from your country, India defaults to the highest treaty rate (or no benefit at all). It's 20 minutes of paperwork that saves real money.
What is DTAA?
Double Taxation Avoidance Agreement — bilateral treaties between India and 90+ countries that prevent the same income being taxed in both countries. India has DTAAs with the US, UK, UAE, Canada, Australia, Singapore, Germany — basically every meaningful diaspora destination.
How DTAA works in practice
Two methods:
- Exemption method: One country exempts the income (rare; mostly UAE).
- Tax credit method (most common): You pay tax in the source country, then get a credit against tax owed in your residence country. Net: you pay the higher of the two rates, not both.
Common scenarios
- NRI in US with NRO interest: India deducts 30% TDS on NRO interest. As US tax resident, you can either claim DTAA-reduced rate of 15% (file Form 10F + tax residency certificate) or pay 30% in India and claim Foreign Tax Credit on US 1040.
- NRI in UAE selling Indian property: 20% LTCG in India; UAE has no income tax, so this is your effective rate.
- NRI in UK with Indian salary: India taxes the salary; UK as residence country gives FTC up to UK rate.
The paperwork
To claim DTAA benefits in India:
- Form 10F — annual self-declaration of foreign tax residency
- Tax Residency Certificate — issued by your foreign tax authority (US: IRS Form 6166)
- PAN — Indian tax ID, mandatory