What is the rate of TDS on NRO accounts ?
Ans.: Banks have obligation under Sec. 195 of Income Tax Act, 1961to deduct tax at source in respect of interest income of Non Resident Indians. The rate of TDS is specified in the Finance Act, every year. Accordingly, as on date TDS applicability is as under: Interest earned up to Rs. 10 lacs TDS @ 30.90% Interest earned beyond Rs. 10 lacs TDS @ 33.99% inclusive of sur-charge. However, applicability of TDS is subject to Double Taxation Avoidance Agreement (DTAA) that India has entered with many countries. 15.