What is TDS and how does it apply to 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 type | Holding period | TDS rate (incl. cess & surcharge) | Applicability |
|---|
| Short-Term (STCG) | Less than 365 days | 23.92% | On all short-term capital gains |
| Long-Term (LTCG) | More than 365 days | 14.95% | 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 type | Tax applicability |
|---|
| Capital gains (Equity and F&O) | Taxed based on segment and holding period |
| Dividends | Subject to TDS before credit |
| Interest on NRO account | Taxable in India |
| Interest on NRE account | Generally exempt from tax in India |
| Rental income | Taxable as income from house property |
| Business or other income | Taxed as per applicable provisions |
FYERS does not provide tax advice. For personalised guidance (including DTAA relief), consult a licensed tax professional.
What if…
| Scenario | What you should know |
|---|
| Provisional TDS looks high | It is adjusted on T+1 based on actual realised gains, not gross trade value. |
| Loss incurred, but TDS entry shown | Only 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 required | Download Form 16A from FYERS and file your ITR/DTAA claim as applicable. |
Last updated: 12 Aug 2025
Related Articles
Why is TDS being charged in my NRI Non-PIS account?
Tax Deducted at Source (TDS) is applied to NRI Non-PIS accounts at FYERS in accordance with Indian income tax and foreign exchange laws. When an NRI earns capital gains from securities sold in India, FYERS is required to deduct applicable tax before ...
Can NRIs apply for IPOs through the FYERS account?
Yes, Non-Resident Indians (NRIs) can apply for Initial Public Offerings (IPOs) using their FYERS Demat account—specifically when it's linked to an NRO Non-PIS (Non-Portfolio Investment Scheme) account. This setup is preferred as it avoids the complex ...
Which banks can be linked for NRO accounts with FYERS?
When opening an NRI trading account with FYERS, the bank you can link to depends on whether you choose the PIS or Non-PIS account type. Banks for PIS accounts For clients trading under the Portfolio Investment Scheme (PIS), FYERS supports ...
What is an NRO Non-PIS account and how is it different from an NRE account?
An NRO Non-PIS account is a type of bank account that enables NRIs to invest in Indian stock markets and mutual funds using income earned within India, such as rent, dividends, or pension income. It does not fall under the RBI’s Portfolio Investment ...
What are the costs involved in converting to an NRO Non-PIS account?
Converting your existing resident FYERS trading and Demat account to an NRO Non-PIS account is free of charge. There are no conversion or account-modification fees, and FYERS support will guide you through the documentation and compliance steps at no ...