Recently, Union Finance Minister Nirmala Sitharaman tabled the Income Tax Bill, 2025, in the Lok Sabha on Thursday. 

The Bill aims to simplify the tax laws, ensuring transparency and ease of interpretation.

According to reports, the new Bill, scheduled for discussion in the Lok Sabha, has been referred to the Select Committee for parliamentary scrutiny. It proposes a series of significant changes that are expected to have a substantial impact on Non-Resident Indians (NRIs).

Under the new changes, the NRIs, particularly those who earn ₹15 lakh or more in India and do not pay any tax elsewhere, will be classified as ‘residents’ for tax purposes.

NRIs are currently taxed only on income sourced from India. This move aims to make them liable for taxes on their earnings in India and close loopholes related to tax benefits claimed under NRI status.

New Income Tax Bill 2025 aims to tax non-residents at 20% on dividend income, while dividends from units in an International Financial Services Centre (IFSC) will be taxed at 10%.

Moreover, any taxable income received by NRI in India will be subjected to tax deducted at source (TDS).