Indian NRIs in the UAE: Essential Steps to File Your ITR Before the July 31 Deadline

Dubai: Indian expatriates residing in the UAE face an important deadline—Income Tax Returns (ITR) for the financial year 2025-2026 must be filed by July 31. Those who have not yet completed this process should be aware of the requirements for filing and the implications of missing the deadline.

Do I Need to File an ITR?

Dixit Jain, CEO and Managing Director of The Tax Experts DMCC, notes that many NRIs in Dubai may mistakenly believe they do not need to file an ITR because their income is solely in Non-resident External (NRE) accounts. However, as investments in mutual funds, shares, or other assets in India increase, these individuals may generate capital gains or taxable income, necessitating the filing of an income tax return. Filing also allows for the claim of refunds on excess Tax Deducted at Source (TDS) and access to benefits under the India-UAE Double Taxation Avoidance Agreement.

Even if an individual’s taxable income falls below the basic exemption limit of INR 4 lakh, they may still be required to file an ITR if certain conditions are met. These include:

• Deposits exceeding ₹1 crore in one or more current accounts.
• Foreign travel expenses exceeding ₹2 lakh during the financial year.
• Electricity bills exceeding ₹1 lakh during the financial year.
• TDS/TCS of ₹25,000 or more during the year (₹50,000 for senior citizens).
• Business turnover exceeding ₹60 lakh or professional receipts exceeding ₹10 lakh.
• Other specified situations under the Income-tax Act.

How Do NRIs File an Income Tax Return?

Before initiating the tax return filing process, NRIs should gather digital copies of the following documents:

• Details of income earned in India.
• Capital gains statements, if applicable.
• Tax Deducted at Source (TDS) certificates.
• Tax Residency Certificate (TRC), if claiming benefits under the India-UAE Double Taxation Avoidance Agreement.

Once these documents are ready, NRIs can file their returns online through the Income Tax Department portal of India. After logging in with their Permanent Account Number (PAN) or Aadhaar, they should select the relevant assessment year, choose the applicable ITR form, fill in their income details, verify the information, and submit the return electronically.

Dos and Don’ts to Keep in Mind

1. Do Check Your Filing Obligation: It is crucial not to assume that there is no filing obligation simply because one earns a salary in the UAE. If there is income or investments in India, filing may still be mandatory.

2. Check for Benefits from the India-UAE Tax Agreement: The India-UAE Double Taxation Avoidance Agreement (DTAA) helps prevent double taxation on the same income. However, these benefits are only available if the return is filed and claimed correctly.

3. Apply for the Tax Residency Certificate (TRC): The TRC is essential for NRIs as it proves tax residency in the UAE and allows for benefits under the India-UAE tax treaty. NRIs can apply for the TRC through the UAE’s EmaraTax portal. The certificate is typically issued within five business days.

4. Don’t Ignore TDS Deductions: If there is dividend income or income from a Non-Resident Ordinary (NRO) account with TDS deducted, filing an ITR can enable the claim of refunds or lower tax liabilities. Under the India-UAE DTAA, certain dividend income may be taxed at a reduced rate of 10%, provided the necessary documentation, including the TRC, is submitted.

Left Your ITR Filing Till the Last Week? Here’s What You Should Do

For those who have delayed filing their return, Jain advises taking immediate action rather than waiting for all documents. Filing with the available data allows for revisions later. If unable to file by July 31, a belated return can still be submitted until December 31, 2026.

However, missing the deadline incurs financial penalties, including a late filing fee of INR 5,000 for taxable income above ₹5 lakh, or INR 1,000 for income below that threshold. Additionally, interest may accrue on any unpaid tax liability until the return is filed.

Filing after the due date may also result in the inability to carry forward losses from the sale of mutual funds, shares, or property, which cannot be set off against future tax liabilities.

For more information, visit www.emirates247.com.

Explore the latest digital editions of FAME Delivered in the Magazine section: Magazine section

Published on 2026-07-27 14:49:00 • By FAME Delivered News Desk