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Fixed Deposit Interest TDS

Your bank deducts 30% TDS on NRO fixed deposit interest under Section 195, while NRE and FCNR interest is exempt. Residents pay 10%. DTAA Article 11 caps the NRI rate by country: **Mauritius 7.5%** (lowest), most Gulf and Continental Europe 10%, UAE 12.5%, US / UK / Singapore / Canada / Australia / Denmark 15%. **Bahrain and Nigeria have no comprehensive DTAA** (only TIEAs): 30% applies in full, with no recovery via treaty. On a ₹50 lakh FD at 7% (₹3.5 lakh annual interest), the saving ranges from zero (Bahrain, Nigeria) to ₹78,750 (Mauritius), with most NRIs in the ₹52,500, ₹70,000 band depending on country.

For UAE NRI on NRO FD interest

Default at-source TDS in India: 30%. Treaty rate (after Form 10F / Form 41 + TRC): 12.5%. Saving = 17.5 percentage points.

Article 11

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What happens to your NRO FD interest as an

Section 195 forces banks to deduct 30% TDS at source on the FD interest that is taxable, which means NRO deposits. NRE interest (Section 10(4)(ii)) and FCNR interest (Section 10(15)(iv)(fa)) carry no TDS at all. Resident Indians only face 10% under Section 194A. DTAA Article 11 caps the NRI rate by treaty: **7.5%** for Mauritius (lowest in any India treaty); **10%** for Oman, Saudi, Qatar, Kuwait, France, Germany, Netherlands, Switzerland, Ireland, Japan, Korea, Hong Kong, NZ, Malaysia, Thailand, Indonesia, Philippines, Sweden, Norway, S. Africa, Kenya; **12.5%** for UAE; **15%** for US, UK, Singapore, Canada, Australia, Denmark; **30%** (no DTAA) for Bahrain and Nigeria. You claim the cap by filing Form 10F (or Form 41 from FY 2026-27) plus your TRC with the bank, or recover the excess in your ITR.

30%

Default rate

Varies

rate by country

UAE NRI, what changes for you

Country-specific overlay on NRO FD interest

Indian tax IS your only tax

UAE has no personal income tax on individual savings interest, dividends, or capital gains. So the India-side rate (after DTAA reduction) is the FULL tax bite, no further drag in your country. NRE / FCNR exempt-in-India income flows through tax-free both sides. NRO / dividend income gets reduced via DTAA where treaty caps apply (UAE 12.5% on interest; Saudi 5% on dividends; etc.), and that reduced rate is your only cost.

NRO FD Interest rates by country

What each country's treaty says

Sorted by savings potential. 50 countries with a DTAA benefit, 2 with the same rate.

Mauritius

Article 11: 7.5% with TRC + Form 10F. The lowest GENERAL interest cap in any India DTAA. (UAE has a 5% sub-rate for interest paid on a loan granted by a bank/financial institution under Article 11(3); Mauritius's 7.5% applies universally on post-31-March-2017 debt-claims.)

Default → DTAA

30%7.5%

Save 22.5%

Oman

Article 11: 10% cap, unchanged by the 2025 protocol. Better than UAE's 12.5%.

Default → DTAA

30%10%

Save 20%

Saudi Arabia

Article 11

Default → DTAA

30%10%

Save 20%

Qatar

Article 11: 10% cap retained in the 2025 revised treaty

Default → DTAA

30%10%

Save 20%

Germany

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Netherlands

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Kuwait

Article 11

Default → DTAA

30%10%

Save 20%

France

Article 12: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Ireland

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Switzerland

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Malaysia

Article 11: 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

Japan

Article 11: 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

South Korea

Article 11 of the 2015 revised treaty, 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

Hong Kong

Article 11 of the 2018 India-HK CDTA, 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

New Zealand

Article 11: 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

South Africa

Article 11

Default → DTAA

30%10%

Save 20%

Kenya

Article 11

Default → DTAA

30%10%

Save 20%

Sweden

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Norway

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Thailand

Article 11: 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

Indonesia

Article 11: 10% with TRC + Form 10F

Default → DTAA

30%10%

Save 20%

Portugal

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Luxembourg

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Austria

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Poland

Article 12: 10% treaty cap after the 2013 protocol (was 15%)

Default → DTAA

30%10%

Save 20%

Finland

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

China

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Vietnam

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Israel

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Sri Lanka

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Tanzania

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Uganda

Article 11: 10% treaty cap on Indian-source interest

Default → DTAA

30%10%

Save 20%

Nepal

Article 11: 10% treaty cap on Indian-source interest, confirmed on the Income Tax Department's own withholding-rate table

Default → DTAA

30%10%

Save 20%

Cyprus

Article 11: 10% treaty cap on Indian-source interest to a Cyprus-resident beneficial owner

Default → DTAA

30%10%

Save 20%

Malta

Article 11: 10% treaty cap on Indian-source interest to a Malta-resident beneficial owner, confirmed against the CBDT's MLI-synthesised treaty text

Default → DTAA

30%10%

Save 20%

Bangladesh

A flat 10% cap on Indian-source interest paid to a Bangladesh-resident beneficial owner, confirmed against the treaty's own notified text (GSR 758(E)); interest paid to the Government of Bangladesh or Bangladesh Bank is separately exempt outright

Default → DTAA

30%10%

Save 20%

Russia

Article 11: flat 10% treaty cap on Indian-source interest to a Russia-resident beneficial owner, confirmed against PwC's own treaty-rate table; interest paid to the Reserve Bank of India or the Russian government is separately exempt outright

Default → DTAA

30%10%

Save 20%

Mexico

Article 11: flat 10% treaty cap on Indian-source interest to a Mexico-resident beneficial owner, confirmed directly from the notified treaty text (Notification 86/2010); interest paid to specified government/development-bank entities on either side is separately exempt outright under Article 11(3)

Default → DTAA

30%10%

Save 20%

UAE

Article 11

Default → DTAA

30%12.5%

Save 17.5%

US

Article 11, caps Indian interest withholding at 15% for US-resident beneficial owners. Applies to NRO FDs, NRO savings, Indian bonds. NRE FD interest is exempt in India but still 100% taxable on your US 1040 as worldwide income, the treaty does not change that, and there is no FTC because India levied no tax.

Default → DTAA

30%15%

Save 15%

UK

Interest article (post-2013 protocol numbering: Article 12; pre-protocol: Article 11), 15% general treaty cap; 10% sub-cap for interest paid to a bona fide bank; 0% (exempt) for interest paid to governments / RBI. India-UK is one of the few major Indian treaties where general interest is capped at 15%, not 10%.

Default → DTAA

30%15%

Save 15%

Singapore

Article 11. DBS/UOB/Citi NRO interest TDS drops from 30% to 15% with TRC + Form 10F

Default → DTAA

30%15%

Save 15%

Canada

Article 11, caps interest withholding at 15% for Canadian-resident beneficial owners.

Default → DTAA

30%15%

Save 15%

Australia

Article 11, capped at 15% with TRC + Form 10F

Default → DTAA

30%15%

Save 15%

Denmark

Article 12(2), the 15% treaty cap on Indian-source interest for individuals. The 10% rate in Article 12(2)(a) applies only where a bank made the loan, so your NRO FD misses it: on that deposit the lender is you.

Default → DTAA

30%15%

Save 15%

Philippines

Article 11: 15% for an individual NRI. The 10% sub-rate applies only where the interest is received by a financial institution or insurer, not to an individual's NRO interest.

Default → DTAA

30%15%

Save 15%

Italy

Article 12: 15% treaty cap on Indian-source interest

Default → DTAA

30%15%

Save 15%

Spain

Article 12: 15% treaty cap on Indian-source interest

Default → DTAA

30%15%

Save 15%

Belgium

Article 11: 15% general treaty cap (10% on bank-loan and credit-sale interest)

Default → DTAA

30%15%

Save 15%

Brazil

Article 11: 15% general treaty cap on Indian-source interest

Default → DTAA

30%15%

Save 15%

Same rate under DTAA (2 countries)

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