Many Indian mariners invest significant portions of their foreign salary in the Indian equity markets and mutual funds. As an NRI seafarer, understanding how capital gains and TDS work is vital.
Mandatory Account Conversion: KYC to NRI
You cannot legally invest in Indian mutual funds using a domestic resident KYC. You must update your KYC status to NRI, linking your NRE or NRO bank account.
Capital Gains Tax Rates
- Listed Equity (Short Term): 20% flat under Section 111A.
- Listed Equity (Long Term): 12.5% on gains exceeding ₹1.25 Lakhs per financial year under Section 112A.
- TDS at Source: Asset Management Companies (AMCs) deduct TDS upfront on NRI redemptions at maximum slab rates. Filing ITR-2 is the only way to claim a tax refund for excess TDS deducted.