Special Provisions for NRIs Chapter XII-A — a tax regime built only for you.
Detailed advisory on Chapter XII-A of the Income-tax Act — special tax rates and procedures for NRIs on investment income and long-term capital gains from foreign exchange acquired assets.
Chapter XII-A (Sections 115C to 115I) of the Income-tax Act creates a special tax regime exclusively for NRIs. It applies to two categories of income — investment income and long-term capital gains — earned from specified Indian assets acquired in foreign exchange.
Under this regime, investment income is taxed at a flat 20% and long-term capital gains at 10%, without the benefit of basic exemption, deductions under Chapter VI-A, or indexation. Section 115G even removes the obligation to file an ITR in certain cases.
We help NRIs evaluate whether opting into Chapter XII-A is beneficial year by year, plan asset acquisitions in foreign exchange, and structure exits to take advantage of the special rates. The regime is optional, so the choice must be made consciously each year.
Our Special Provisions for NRIs Services
Chapter XII-A Eligibility
Evaluation of eligibility for Section 115C to 115I special tax rates.
Investment Income Tax
Application of flat 20% rate on dividends, interest, and other specified investment income.
LTCG Special Rate
Long-term capital gains taxed at 10% on foreign exchange acquired assets.
Section 115G Filing Relief
Review of conditions for exemption from ITR filing under Section 115G.
Continuance Option
Continuance of special regime even after returning to India under Section 115H.
Asset Acquisition Planning
Structuring of asset acquisitions in foreign exchange to qualify.
Comparison with Normal Regime
Tax-cost comparison of Chapter XII-A versus normal slab regime.
Annual Election
Year-wise election and disclosure in the income tax return.
Our Approach
Income & Asset Review
All investment income and capital gains assets reviewed for foreign exchange origin.
Eligibility Check
Verification of conditions under Section 115C and 115D.
Regime Comparison
Tax computed under Chapter XII-A and normal regime; net position compared.
Decision & Disclosure
Election made and disclosed in the ITR for the year.
Documentation
Proof of foreign exchange acquisition retained for future verification.
Why It Matters
Frequently Asked Questions
Special tax rates on investment income and long-term capital gains of NRIs from foreign exchange acquired assets.
No, it is an optional regime that can be chosen year by year.
A flat 20% on investment income from specified Indian assets.
10% on long-term capital gains from qualifying foreign exchange acquired assets.
Yes, Section 115H allows continuance on existing investments after becoming resident.
Want to Check If Chapter XII-A Saves You Tax?
Get a comparison of Chapter XII-A versus the normal regime for your case — and a documented election that holds up to scrutiny.
Compare My Tax Regimes or call +91 9819 000 511