What is TDS, and How Is It Applied on NRI Non-PIS Accounts at FYERS?

What is TDS, and How Is It Applied on NRI Non-PIS Accounts at FYERS?

Tax Deducted at Source (TDS) is tax collected at the point of income generation under the Income Tax Act, 1961. For NRI Non-PIS accounts at FYERS, TDS applies on capital gains and certain India-sourced income, and is processed through a structured two-step settlement to ensure accuracy and compliance.

Application of TDS on capital gains

TDS for capital gains is executed in two stages to reflect actual realised gains.

  • Provisional TDS blocking (T+0): After you sell a security, a provisional TDS amount—based on transaction value and indicative rate—is blocked and appears as a temporary debit in your ledger.
  • Final TDS deduction or reversal (T+1): On the next business day, the provisional amount is reversed and actual TDS is applied on the day’s realised capital gains.

Basis of TDS calculation

TDS is computed on overall realised gains, not on an individual trade basis.

  • Calculation considers cumulative realised capital gains across all trades in the financial year.
  • Eligible losses are netted before applying the applicable rate and exemption thresholds.

TDS rates for capital gains

Rates vary by holding period and are applied after considering applicable thresholds.

Capital gains typeHolding periodTDS rate (incl. cess & surcharge)Applicability
Short-Term (STCG)Less than 365 days23.92%On all short-term capital gains
Long-Term (LTCG)More than 365 days14.95%On long-term gains exceeding ₹1,25,000 in a financial year

Other taxable income for NRIs

Besides capital gains, some income types credited in India may also be subject to tax/TDS.

Income typeTax applicability
Capital gains (Equity and F&O)Taxed based on segment and holding period
DividendsSubject to TDS before credit
Interest on NRO accountTaxable in India
Interest on NRE accountGenerally exempt from tax in India
Rental incomeTaxable as income from house property
Business or other incomeTaxed as per applicable provisions
FYERS does not provide tax advice. For personalised guidance (including DTAA relief), consult a licensed tax professional.

What if…

ScenarioWhat you should know
Provisional TDS looks highIt is adjusted on T+1 based on actual realised gains, not gross trade value.
Loss incurred, but TDS entry shownOnly net positive realised gains are taxed; eligible losses offset the tax. Ledger shows the T+0 block and its T+1 reversal.
Refund or credit requiredDownload Form 16A from FYERS and file your ITR/DTAA claim as applicable.

Last updated: 12 Aug 2025