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Uganda NRIs · Rental Income Tax

Rental income tax for NRIs in Uganda

Renting out Indian property from Uganda means your tenant must deduct tax on the gross rent. Set it up right and reclaim the heavy over-deduction.

When you rent out Indian property while living in Uganda, the rent is taxed in India. Under the India-Uganda treaty, income from immovable property is taxable where the property sits (Article 6), so the rate doesn't drop for living abroad. Because you're a non-resident landlord, your tenant is legally required to deduct tax at source on the rent under Section 393(2) (Section 195 until 31 March 2026), at the 31.2% non-resident rate on the gross rent, not under the lighter resident-landlord rule. That deduction is heavier than your actual tax, because you get a 30% standard deduction when you file, so most of the gap comes back as a refund.
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India-Uganda key facts: rental income tax

Default non-resident TDS rate31.2%
What the treaty changes hereIt sets no lower rate on this income. What a treaty decides here is which country gets to tax it.
Treaty article / basisArticle 6, source-country taxation
Your TRC issuing authoritythe Uganda Revenue Authority (URA)

Rates reflect India's domestic withholding under Section 393(2) (Section 195 until 31 March 2026) and the India-Uganda treaty. Surcharge applies on top; the 4% cess is already included in this figure.

How it works on the India side

A tenant paying rent to an NRI landlord must deduct TDS under Section 393(2) (Section 195 until 31 March 2026), the provision for any payment to a non-resident, which means the tenant has to take a TAN, deduct each month on the gross rent, deposit it, file a quarterly Form 144 (the old Form 27Q) against your PAN, and issue you a TDS certificate. The common, costly mistake is the tenant using Section 194-IB, the 2% resident-landlord rule, which doesn't apply to a non-resident landlord and leaves both sides exposed.

The deduction on gross rent is more than you actually owe, because your taxable rental income is much smaller: a flat 30% standard deduction comes off under Section 24(a), and home-loan interest comes off too. When you file your return, the TDS the tenant deposited is set against your real liability and the excess is refunded, but only if the tenant's quarterly statement correctly reports it against your PAN, which is why setting the tenant up right from the start matters. If you'd rather not wait a year for that refund, a lower-deduction certificate on Form 128 under Section 395 (the old Form 13 under Section 197) can cut the monthly deduction at source instead.

What changes because you live in Uganda

Uganda makes you pay tax on this Indian income in advance, on a figure you guess yourself. None of it is withheld at source under Ugandan law, so it makes you a provisional taxpayer: you file your own estimate of the year's chargeable income by the end of September and pay against it in four instalments, on the last day of the third, sixth, ninth and twelfth months of a year of income running 1 July to 30 June (sections 111 and 112 of the Income Tax Act). Guess low and it costs. Come in under 90% of what you actually made and section 154 adds penal tax of 20% of the tax you left out. A flat sale or a fund redemption in India is what usually breaks the estimate, so file a revised one before the next instalment falls due, since a revision only counts for instalments after it reaches URA.

Frequently asked questions

Common questions from Uganda NRIs

Under Section 393(2), the successor to Section 195, because you're a non-resident landlord. The tenant has to take a TAN, deduct on the gross rent at the 31.2% non-resident rate, deposit it, file a quarterly Form 144 (the old Form 27Q) against your PAN and give you the TDS certificate. Section 194-IB, the 2% rule most tenants know (it was 5% until 1 October 2024), applies only to resident landlords and is the wrong provision for a non-resident.

Yes. The deduction is on the gross rent, but your taxable rental income is much smaller, because you get a flat 30% standard deduction under Section 24(a) plus any home-loan interest before tax is computed. The over-deducted amount comes back as a refund when you file your Indian return, provided the tenant's quarterly statement correctly reports the TDS against your PAN. Uganda NRIs who don't want to wait for that refund apply for a Form 128 certificate instead.

No. Income from immovable property is taxable where the property sits (Article 6), so Indian rent stays taxable in India regardless of where you live. Uganda may tax the same rent, with a credit for the Indian tax paid, though whether it does turns on remittance and residence-year rules the note below sets out. The treaty stops double taxation. The saving comes from the 30% standard deduction and reclaiming the over-deducted TDS, not from a lower treaty rate.

Go further

Read the full guide, or see your country's complete picture

NRI landlord: setting your tenant up for Section 195 TDSUganda NRI tax guide: every income type and the rates that apply

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