If you’re an NRI living abroad, selling property in India still comes with tax obligations.
Even if you live in Canada, any capital gains from a property in India are taxable in India.
The tax you pay depends on:
How long you held the property
How the gain is calculated
One common issue NRIs face is TDS (Tax Deducted at Source).
The buyer usually deducts tax at the time of payment.
This amount can sometimes be higher than your actual tax liability, unless you get a lower deduction certificate.
Will You Be Taxed Twice?
This is a common concern for NRIs.
If the same income is taxed in Canada, you don’t necessarily lose money twice.
Under the India–Canada tax treaty, you can usually claim a foreign tax credit. This helps avoid double taxation and balances your tax burden across both countries.
Retirement Benefits: Tax-Free or Not?
If you’re retiring and expecting payouts like gratuity or leave encashment, here’s some good news.
For government employees, both are fully tax-free under Section 10(10) and Section 10(10AA).
For private sector employees, there are limits:
Gratuity exemption is capped at the lowest of:
Rs 20 lakh
Actual amount received
Calculated amount as per rules
Leave encashment exemption is capped at the lowest of:
Rs 25 lakh
Actual amount received
10 months’ average salary
Value of unused leave (with limits)
Loss in Options Trading? Here’s How It Works
If you incurred losses in options trading, you can’t just adjust them against stock investment gains.
Why?
Because such losses are treated as business losses, not capital losses.
This means:
You can set them off against business income only
You cannot adjust them against capital gains
If the loss is not fully used, you can carry it forward to future years.
But there’s a catch.
You must file your income tax return on time to claim this benefit. Missing the deadline could mean losing the chance to carry forward the loss.
The Bottom Line
Tax rules can get tricky, especially for NRIs and active traders.
From property sales to retirement benefits and trading losses, each income type is treated differently.
Understanding these basics can help you:
Avoid paying excess tax
Plan your finances better
Make the most of available exemptions and benefits
A little clarity now can save you a lot of trouble later.
