3.
Special rates for non-residents as per domestic provisions
(1) The following incomes in the case of non-resident are taxed at special rates on gross basis:
Transaction
Rates
(a)
Dividend
20%
Interest received on loans given in foreign currency to Indian concern or Government of India (not being interest referred to in section
194LB or section 194LC)
20%
Income received in respect of units purchased in foreign currency of specified Mutual Funds / UTI
20%
Royalty or fees for technical services(b)
10%
Interest income from a notified infrastructure debt fund, specified loan agreement, specified long-term bonds,rupee denominated bonds(c)
and business trust
5%
Interest on FCCB, Dividend on GDRs
10%
(a) These rates will be further increased by applicable surcharge and health and education cess.
(b) In case the non-resident has a Permanent Establishment (PE) in India and the royalty/fees for technical services paid is effectively connected with such PE,
the same is taxable at 40% (plus applicable surcharge and health and education cess) on net basis.
(c) Interest payable to a non-resident in respect of monies borrowed by any Indian company or business trust from a source outside India by way of issue
of rupee denominated bond during the period 17 September 2018 to 31 March 2019 is exempt from tax.
(2) Tax on non-resident sportsmen or sports association on specified income @20% plus applicable surcharge and health and education cess.
4.
Capital Gains
Transaction
Short-term capital gains
(a)
Long-term capital gains
(a)(b)
Sale transactions of equity shares/ unit of an equity oriented fund which attract STT
15%
10%*
Sale transaction other than mentioned above:
Individuals (resident and non-residents)
Progressive slab rates
20% / 10%
(b)
Firms
30%
Resident companies
30%/25%
(d)
/ 22%
(e)
/15%
(f)
Overseas financial organizations specified in section115AB
40% (corporate) 30%
(noncorporate)
10%
FIIs
30%
10%
Foreign companies other than ones mentioned above
40%
20% / 10%
(C)
Local authority
30%
20% / 10%
Co-operative society rates
Progressive slab or 20%
(g)
*Income-tax at the rate of 10% to be levied on long-term capital gains exceeding Rs. 1 lakh (without indexation benefit and foreign exchange fluctuation).
(a) These rates will further increase by applicable surcharge &health and education cess.
(b) Income-tax rate of 20% with indexation and 10% without indexation.
(c) Long term capital gains arising to a non-resident from transfer of unlisted securities or shares of a company, not being a company in which the public are
substantially interested, subject to 10 per cent tax (without benefit of indexation and foreign currency fluctuation).
(d) If total turnover or gross receipts inthe financial year 2018-19 does not exceed Rs. 400 crores.
(e) This lower rate is optional and subject to fulfillment of certain conditions as provided in section 115BAA.
(f) This lower rate is optional for companies engaged in manufacturing business (set-up & registered on or after 1 October 2019) subject to fulfillment of certain
conditions as provided in section 115BAB.
(g) The Finance Act, 2020 provides fornew optional tax regime for co-operative societies. Thus, co-operative societies have the option to be taxed at progressive
slab rates or 20% subject to fulfillment of certain conditions as provided in section 115BAD.