The numbers most NRIs never see
We mapped India's tax treaties across the 52 countries where we work and ran the same ₹15 lakh NRO fixed deposit through each one. The pattern is consistent: the money is lost at the withholding stage, not in some exotic loophole.
The 30% default is almost never the rate you actually owe. 50 of the 52 countries have a comprehensive DTAA with India; only 2 (Nigeria and Bahrain) fall back on domestic relief. Yet banks deduct the full 30% (Section 195, now Section 393) until you file the paperwork.
The median treaty rate on NRO interest is 10%, about a third of the default. It runs from 7.5% (Mauritius) to 15%.
On a single ₹15 lakh FD at 7%, the median over-withholding is about ₹21,000 a year (₹23,625 at the Mauritius rate). That is one deposit. It repeats across every interest, dividend and rental credit, every year you don't claim it, and up to five past years can be reopened.
11 of the 52 countries don't tax your Indian income again at home, the Gulf states plus Singapore and Hong Kong, so that Indian rate is the only tax you pay. The other 41 tax it again and give a foreign tax credit, which makes claiming the lower Indian rate at source matter even more.
Where the gap is biggest, by region
Sorted by where you live, the gap clusters in two places: the Gulf, where there is no home-country tax to offset the Indian over-deduction, and the worldwide-income countries, where over-withholding ties up cash you then have to reclaim against your US, UK or Canada return.
| Region | Countries we cover | Median treaty rate on NRO interest | Tax your Indian income at home? |
|---|---|---|---|
| Gulf/GCC | 6 | 10% | No |
| Americas | 4 | 15% | Yes. All |
| Europe | 20 | 10% | Yes. All |
| Asia-Pacific | 16 | 10% | 11 of 16 |
| Africa | 6 | 10% | Yes. All |
The full, sortable country-by-country table is further down this page. The regional shape above is the quick read.
The dividend trap most NRIs miss
One result surprises almost everyone: in the United States and Canada, the DTAA gives an individual NRI no dividend saving at all. The treaty's low 15% dividend rate (Article 10) is reserved for *corporate* shareholders holding 10% or more of the Indian payer. An individual falls under the treaty's other-case rate of 25%, which is *higher* than India's 20% domestic rate, so you simply pay the 20% and the treaty does nothing for you. A couple of other treaties read the same way.
So "I live in a DTAA country" does not automatically mean a lower dividend rate. It depends on the specific treaty article and on whether you are an individual or a company. On interest, and on the lower-TDS route for a property sale, the relief is real and worth claiming; on dividends, check the article first.
Key numbers for FY 2026-27
For reference, the rates and forms an NRI is working with this year, after the Income-tax Act 2025 renumbering:
| What | Where it stands for FY 2026-27 | Form / section |
|---|---|---|
| NRO interest TDS | 30% (plus 4% cess = 31.2%); cut to your treaty rate with a TRC | Section 195 to 393; Form 41 (was 10F) |
| Dividends, listed equity | 20% default; many treaties cap at 10-15%, but US/Canada individuals get no benefit (treaty rate 25% beats the 20% domestic) | DTAA Article 10 |
| LTCG, listed equity | 12.5% on gains above ₹1.25 lakh a year | Section 112A to 198 |
| STCG, listed equity | 20% | Section 111A to 196 |
| Property sale (LTCG) | 12.5%; the buyer deducts TDS, apply for a lower-TDS certificate | Lower cert: Form 128 (was 13), Section 395 |
| Resident if you are in India | 182 days or more in the year | Section 6 |
| Deemed-resident trap | Indian income over ₹15 lakh can pull you back to resident at 120 days in India | Section 6 |
The forms changed on 1 April 2026 (Form 10F is now Form 41, Form 13 is now Form 128); the rates carried over unchanged. If you are reading older guidance with the old numbers, it is not wrong, just check which year it covers.
How we built this
This report is derived from our own dataset of India's notified Double Taxation Avoidance Agreements across 52 countries, cross-checked against the CBDT TDS rate chart. The savings figures use a fixed ₹15,00,000 NRO fixed deposit at 7% interest (₹1,05,000 a year) so the comparison is like-for-like across countries; your own number scales with your balances and income mix.
Rates are current for FY 2026-27 and we re-verify them against primary sources (incometax.gov.in, the CBDT rate chart and the notified treaties) on a rolling basis. Treaty positions change through protocol amendments and CBDT notifications, the "last reviewed" date at the top of this page is when the figures were last checked.