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TDS on NRE account

Renu (Student) (460 Points)

12 May 2022

My bank has wrongly deducted TDS for interest received in my NRE account.

But income from NRE account 8s exempt from tax.

Please guide how to proceeds further.

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7 Replies

Eswar Reddy S (CFO- at NHTF) (58213 Points)
Replied 12 May 2022

It is covered by Section 195.

Payment to NRI.

So tds will be deducted by bank or financial institutions

2 Like

CA Puja Sharma (Chartered Accountant) (4874 Points)
Replied 12 May 2022

When you file your Income Tax Return, mention the interest from NRE account under exempt interest section.

The excess TDS deducted by the bank can be claimed as refund while filing the return.

1 Like

Renu (Student) (460 Points)
Replied 12 May 2022

Mr. Eswar, but pyt to NRI made in NRE account ie interest is exempt under sec 10.

Eswar Reddy S (CFO- at NHTF) (58213 Points)
Replied 12 May 2022

For the purposes of Tds deduction there is no exemption.. Exemption may be claimed in ITR and apply for tax refund

2 Like

Ananthu (student) (73 Points)
Replied 12 May 2022

I think the bank is at fault, Interest on NRE account is totally exempt. If bank has deducted TDS ,tell them not to deduct any more TDS and ,claim the deducted TDS on filing return and claiming exempt as suggested by Puja Sharma