Is it NRE Bank Interest taxable for Resident Individual ?

Is it NRE Bank Interest taxable for Resident Individual ?
Replies (5)
Quick Summary
This discussion clarifies the taxability of NRE bank interest for resident individuals. While a resident typically shouldn't hold an NRE account, any bank interest earned is generally taxable. The key difference lies in TDS deduction: banks deduct it for non-residents but not for residents. However, for non-residents, interest accrued on NRE accounts is exempt from tax.

A resident is not supposed to have an NRE account.

In any event, all Bank interest is taxable for everyone, whether they are resident or not. The difference is that the banks are required to deduct TDS for interest paid to the non-resident, whereas there is no deduction for residents.

At the end of the year, it will make no difference in the tax calculation.

Can get any deduction if the individual is non resident?

If the individual is Non-Resident, then interest accrued on the NRE account is exempt. 

Originally posted by : CA Puja Sharma
If the individual is Non-Resident, then interest accrued on the NRE account is exempt. 

Agreed! But first they need to decide if they are resident or not!

Exempted

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