Indian rental income when you are a Swiss tax resident

In India the rent is income from house property, taxed after a flat 30% standard deduction under Section 24, which you get whatever you actually spent, and after home-loan interest, at slab rates. As a non-resident landlord, your tenant must deduct TDS under Section 195 on the gross rent, at about 30% plus surcharge and cess, far higher than the small rate that applies to a resident landlord. That over-deducts against your real Indian tax, so you recover the excess by filing an Indian return, or reduce it up front with a lower-deduction certificate.

Switzerland taxes its residents on worldwide income, but it makes a specific exception for foreign real estate. The income from your Indian property is exempt from Swiss income tax; it is declared, but only so that it can be counted in setting the rate that applies to your Swiss-taxable income. This is exemption with progression, so the Indian rent is not itself taxed in Switzerland; it may just nudge up the rate on the rest of your income.

So the practical result is clean: India taxes the rent, and Switzerland does not, only raising its own rate slightly. India's tax after the 30% deduction is the real cost. The one thing to carry forward is that this exemption is for income tax. The property itself still enters the Swiss wealth tax, where its value, though excluded from the taxable base as foreign real estate, is used to set your wealth-tax rate, so it is not entirely off the Swiss radar. A practising CA files the Indian return, recovers the over-deducted TDS, and gives your Swiss accountant the rent figure for the progression and the property value for the wealth tax.