NRI Tax on Thailand Property 2026: The DTAA

NRI Tax on Thailand Property 2026: The DTAA Guide for Indian Buyers

If you are an Indian resident, NRI, or RNOR who owns or is buying a Phuket condo, you have two tax authorities looking at your file: the Thai Revenue Department and the Indian Income Tax Department. Get the structure right and you pay tax once, with the Thai tax credited at home. Get it wrong and the exposure is under the Black Money Act 2015, whose consequences are set out below. Nobody on this project practises Indian tax law: the statements here are the questions to put to a chartered accountant who has filed Form 67 for Thai income before.

NRI tax: Cross-read the nationality master guide for India-specific buying paths before you rely on DTAA assumptions here.

This guide gives you the direct answer first, then walks through the India-Thailand DTAA 1985, ITR-2 filing, NRO/NRE repatriation, and five legal tax-saving strategies, all updated for the Budget 2024 capital gains regime and for the Common Reporting Standard exchange that Thailand takes part in.

Why This Matters: ₹50 Lakh+ Penalties for Non-Disclosure

Under the Black Money Act 2015, an undisclosed foreign asset (such as a Phuket condo) attracts:

30% tax on the value of the asset (not the income, the asset value)
Penalty equal to 90% of the tax (so 27% additional)
₹10 lakh base penalty for non-filing of Schedule FA
Prosecution provisions with imprisonment for wilful non-disclosure

On an undisclosed unit the tax and penalty together run to well over half the asset’s value before the fixed penalty and the criminal exposure, and the look-back for foreign assets is far longer than the ordinary reassessment window. The earlier version of this page put a rupee figure and a year count on both; the rule is registered on the site as unverified and the arithmetic is your CA’s.

How They Catch You: CRS and Thailand

For years, Indian buyers in Thailand assumed the data did not flow back. Thailand takes part in the Common Reporting Standard under the OECD multilateral agreement, and Thai financial institutions report account holders who are tax resident elsewhere: name and tax identification number, account number, year-end balance, and interest and gross proceeds. The earlier version of this page dated Thailand’s first exchange to a month it could not source; the date is not the point.

The Indian side receives that data and it surfaces in the Annual Information Statement against your PAN. A Thai bank account or rental income that appears in the AIS but not in your Schedule FA is the kind of mismatch that draws a notice; the earlier version put a timescale on that and claimed case knowledge it could not show, and both are withdrawn.

Disclosure is mandatory, and the exchange makes non-disclosure a matter of when, not whether.

Resident, NRI, or RNOR: Which Are You in 2026?

Resident (ROR: Resident and Ordinarily Resident)

You are a Resident in a financial year if either of these is true:

You stayed in India for 182 days or more in that financial year, OR
You stayed in India for 60 days or more in that financial year AND 365 days or more across the four preceding years

You are Ordinarily Resident if you have also been a resident in 2 of the preceding 10 years AND in India for 730 days or more across the preceding 7 years.

A Resident pays Indian tax on worldwide income. Your Phuket rental, your Thai bank interest, and your eventual capital gain on sale are all in scope.

NRI (Non-Resident Indian)

You are a Non-Resident if you do not meet either of the above tests, typically because you spent over 182 days outside India in the financial year. NRIs pay Indian tax only on Indian-source income. Your Phuket rental is outside scope.

Critical 2020 amendment: an Indian citizen or PIO whose Indian-source income exceeds ₹15 lakh in a financial year and who is not liable to tax in any other country is now deemed resident in India under Section 6(1A), even if physically outside India for over 182 days. This caught many Indians living in UAE, Bahrain, Oman, Qatar (zero-income-tax jurisdictions). If you are deemed resident under 6(1A), you are taxed as RNOR; see below.

RNOR (Resident but Not Ordinarily Resident)

You are RNOR if you meet the residency test but fail the ordinarily-resident test. Typical case: you returned to India after years abroad. You get a 2 to 3 year RNOR window during which you are taxed only on Indian-source income plus any income derived from a business or profession set up in India, your Phuket rental remains outside scope.

For most NRIs returning to India after a Gulf or Singapore career, this RNOR window is the most tax-efficient time to sell a Phuket property; see Strategy 4 below.

Status	Days in India	Phuket Rental Taxed in India?	Phuket Capital Gain Taxed in India?	Schedule FA Required?
Resident & Ordinarily Resident	182+ days	YES	YES	YES
RNOR (transitional)	182+ but failing 7-yr test	NO	NO	YES (in disclosure year)
NRI	Under 182 days	NO	NO	NO (NRI exemption)
Deemed Resident u/s 6(1A)	Under 182 but Indian income over ₹15L and zero-tax country	Treated as RNOR	Treated as RNOR	YES

Tax on Rental Income from Phuket: Three Detailed Cases

Thai Side: Personal Income Tax + Withholding

Thai rental income is treated as Section 40(5) rental income under the Thai Revenue Code. The basic mechanics:

An owner who spends fewer than 180 days a year in Thailand has Thai tax withheld at source by the managing agent or the paying entity; an owner over that line files on the progressive scale after the standard deduction for rental. The rental income tax page holds the rates and the filing route and is the page updated when they move; the effective-rate range the earlier version quoted here did not match it and is withdrawn.
Accommodation let for under 30 days is hotel business under the Hotel Act and needs a licence, which is why most foreign-owned condominiums let nightly through a licensed operator; the building’s own regulations can restrict short lets independently.

Indian Side: Slab Rate Less DTAA Credit

The same rental income is added to your Indian total income under the head “Income from House Property”:

Gross rent in INR, converted at the rate Rule 115 prescribes (the SBI TT buying rate)
Less 30% standard deduction under Section 24(a), same deduction logic as India
Less municipal taxes paid in Thailand (Land and Building Tax, Local Maintenance Tax)
Net annual value added to total income, taxed at slab (up to 30% + surcharge + cess)

Three Cases, in Shape

The earlier version worked three cases in rupees with Thai and Indian tax figures that it could not source. The shapes are what matter, and they are kept:

Case A, a resident owner: the rent is taxed in Thailand first, then declared in India as house property with the 30% standard deduction, taxed at slab, and the Thai tax credited through Form 67. The combined bill is the Indian slab tax on the net figure, no more, provided the credit is claimed with evidence.

Case B, an NRI: the Phuket rent is foreign-source income outside Indian scope, so the Thai tax is the whole bill, and the saving against resident status is the entire Indian layer.

Case C, a resident owner who uses the unit part of the year: only the months let produce rent to declare; a foreign property held for income does not attract notional rent on the owner’s own use in the way a second Indian house can. Confirm the point with your CA, because it is the one most often argued.

Want a tax model on your specific Phuket investment?

Send us the budget and intended use, we share a 5-year India + Thailand tax model from a CA who has worked DTAA cases since 2018.

Get a tax model WhatsApp

Capital Gains Tax When You Sell Your Phuket Property

Thai Side: Transfer Fees, Not Capital Gains

When you sell at the Phuket Land Office, you (or the buyer, depending on the SPA) pay:

Charge	Rate	Who Pays (Customary)
Transfer Fee	2% of appraised value	Split 50/50 buyer & seller
Specific Business Tax (SBT)	3.3% of selling price (or appraised, whichever higher)	Seller (if held under 5 years)
Stamp Duty	0.5% of selling price	Seller (if SBT does not apply)
Withholding Tax	Progressive PIT on deemed gain (5-year scaled deduction)	Seller

If you hold the condo for 5+ years or use it as your registered residence for over 1 year, SBT does not apply and you pay the lower 0.5% stamp duty. The withholding tax is the closest Thai equivalent to Indian capital gains tax, it is calculated by the Land Office using a deemed-gain formula based on holding period and the appraised value, then collected at source. It is final for foreigners, no separate Thai capital gains return is needed.

The Thai exit costs together typically run to a few percent of the price depending on holding period and who pays what under the SPA; the transfer fees page works them at three prices.

Indian Side: LTCG vs STCG (Budget 2024 Changes)

For Indian Residents, the eventual capital gain on a Phuket property is taxed under the standard capital gains regime, with the 24-month holding-period threshold for immovable property:

Holding Period	Classification	Tax Rate
Under 24 months	Short-Term Capital Gain (STCG)	Slab rate (up to 30% + surcharge + cess)
24+ months, sold before 23 July 2024	LTCG (old regime)	20% with indexation
24+ months, sold on or after 23 July 2024	LTCG (new regime, taxpayer choice)	20% with indexation OR 12.5% without

The Budget 2024 amendment (Finance Act 2024) gave Indian taxpayers a one-time choice for property purchased before 23 July 2024: 20% with indexation OR 12.5% without indexation. For properties bought after 23 July 2024, the flat 12.5% (no indexation) rate applies. For Phuket, where the cost basis is in foreign currency and indexation is applied to the INR-converted value, the new 12.5% flat rate is almost always cheaper for properties held over 5 years, INR has historically depreciated faster than CII inflation indexed the cost basis.

The earlier version worked an example here in rupees with an indexation figure it could not source; it is withdrawn. The shape holds: on a unit bought in baht and sold in baht, the rupee gain includes the currency move, indexation is applied to a rupee cost that was converted years earlier, and the 12.5% option is often the cheaper of the two on a long hold. Your CA runs both.

DTAA India-Thailand 1985: Full Breakdown

The four articles that matter for property owners:

Article 6: Income from Immovable Property

“Income from immovable property may be taxed in the Contracting State in which such property is situated.”

Translation: Thailand has the primary right to tax your Phuket rental income. India retains the right to tax it as well (because of worldwide-income principle), but the Thai tax becomes creditable.

Article 13: Capital Gains

“Gains from the alienation of immovable property… may be taxed in the Contracting State in which such property is situated.”

Translation: Thailand has the primary right to tax the capital gain when you sell the Phuket condo (which it does via the Land Office withholding). India also taxes the gain as worldwide income, with FTC available.

Article 24: Elimination of Double Taxation

The 1985 treaty uses the credit method (not the exemption method). India allows a tax credit equal to the Thai tax paid on the same income, capped at the Indian tax that would have been payable on that income.

Article 25: Mutual Agreement Procedure

If you have a dispute with either tax authority, you can invoke MAP through the Indian CBDT. The 2017 protocol added arbitration for unresolved cases.

How to Claim FTC in India

You must file Form 67 electronically on the income tax portal before your ITR is processed, typically before the 31 December assessment-year deadline. Required attachments:

Statement of foreign income offered to tax in India
Tax residency certificate (TRC) from the Thai Revenue Department, applied for at a provincial Revenue Office; no processing time is promised here
Proof of Thai tax payment (PIT receipt, Land Office withholding receipt)
SWIFT/RTGS confirmation of any Thai tax paid

Without Form 67, your FTC claim is rejected and you double-pay the tax.

ITR Filing for Indian Phuket Property Owners

The Mandatory Schedules

Schedule	Purpose	Trigger
Schedule FA	Foreign Assets disclosure	Any foreign asset including bank account, property, shares, mandatory for all Residents and RNOR
Schedule FSI	Foreign Source Income	Any income earned outside India
Schedule TR	Tax Relief claimed	Any DTAA / FTC claim
Schedule HP	Income from House Property	Phuket rental income reported as house property
Schedule CG	Capital Gains	When you sell the Phuket condo
Form 67	FTC claim	Must be filed before ITR processing

What to Disclose in Schedule FA

For each foreign asset, you provide:

Country code (TH for Thailand)
Name and address of the bank or property
Account number / Chanote number
Status (owner / beneficial owner / beneficiary)
Account opening date or property acquisition date
Peak balance / property value during the year (in INR at SBI TT rate)
Closing balance / value at FY end
Income earned (gross rent, interest)

Deadlines

Non-audit cases: 31 July following the financial year end
Audit cases (turnover over ₹1 crore for business / ₹50L professional): 31 October
Form 67 (FTC): before ITR processing, practically file together with ITR
Belated return: 31 December (with ₹5,000 fee, no FTC allowed for some categories)

A missed Schedule FA disclosure is never just a penalty under the Income Tax Act, it is a Black Money Act case, with the consequences described in Section 2 above.

Repatriation: NRO, NRE, and RFC When Selling

Account Type	Best For	Repatriation Limit	Tax on Interest
NRO (Non-Resident Ordinary)	Indian-source income for NRIs; receipt of foreign sale proceeds for Residents	$1 million / FY (with CA certificates)	TDS at 30%
NRE (Non-Resident External)	NRI overseas earnings, freely repatriable	Unlimited	Tax-free interest
RFC (Resident Foreign Currency)	Returning NRIs (RNOR window) for unspent foreign funds	Unlimited	Slab rate

For an Indian Resident selling a Phuket property, the standard route is:

Sale proceeds credited to your Thai bank account in THB
You wire THB to your Indian bank as inbound foreign remittance
Bank converts to INR at the current rate
The $1 million per financial year repatriation cap under the FEMA framework applies
Forms 15CA and 15CB are for outward remittances to non-residents and do not apply to money you are bringing home; the earlier version of this page said otherwise. Your bank will want the sale deed, the Land Office receipt and the FET records from the original purchase as the source trail
Sale proceeds are credited to your resident savings account

For an NRI, the route is different: the proceeds can flow directly into an NRE account if the original purchase was funded from NRE balances (a “circular” structure). This requires you to have kept the FET certificates showing the original outbound transfer matches the inbound proceeds; see our proof-of-funds guide for the documentation discipline.

5 Legal Tax-Saving Strategies for Indian Phuket Owners

Strategy 1: Time the Sale Past 24 Months for LTCG

Selling within 24 months triggers short-term capital gain at slab rate with surcharge and cess on top. Selling after 24 months moves the gain to the long-term regime at 12.5% without indexation. On any sizeable gain the difference is a multiple, which is the case for waiting the extra months; the rupee example the earlier version gave is withdrawn.

Strategy 2: Joint Ownership Splits the Gain

Buying jointly with your spouse (each contributing the LRS allowance) splits the eventual capital gain across two PANs. Each spouse uses their own basic exemption limit (₹3L under new regime / ₹2.5L under old) and lower slab brackets if other income is modest. Splits also reduce surcharge bracket exposure (15% surcharge starts at ₹50L, 25% at ₹2 crore).

Strategy 3: Section 54F Reinvestment in Indian Residential Property

Section 54F of the Income Tax Act allows full LTCG exemption if the net sale consideration is reinvested in one Indian residential property within 1 year before or 2 years after the sale (3 years if under construction). Conditions:

You must not own more than one other residential house on the date of sale (excluding the new investment)
The new property must be in India (not another Phuket condo, Section 54F is India-only)
Capped at investment of ₹10 crore (Budget 2023 cap)

For an Indian who sells a Phuket condominium and reinvests the net consideration in a new home in India within the time limits, the long-term gain can be exempt in full.

Strategy 4: Sell During the RNOR Window

If you are returning to India after years as an NRI in Singapore, Dubai, or London, you have a 2 to 3 year RNOR window. During RNOR years, foreign-source capital gains are outside scope of Indian tax. Plan your Phuket exit during the RNOR window and the sale is fully India-tax-free (you still pay Thai exit costs, but no Indian LTCG).

Strategy 5: Add Thai Costs to Your Cost Basis

Thai PIT, SBT, transfer fees, and Land Office withholding are all add-backs to your cost basis for Indian capital gains computation, lowering the gain. Many Indian CAs miss this because Thai documents are in Thai. Get certified English translations of every Thai tax receipt and keep them with your Schedule CG workings.

Buyer scenarios: three NRI tax structures by residency

Scenario 1: NRI in Dubai, planning RNOR transition

Profile: an Indian citizen working in the Gulf for years, owner of a Bang Tao condominium bought from Gulf earnings.

Current residency: NRI, under 182 days in India and, because the deemed-residence test in Section 6(1A) turns on Indian-source income above ₹15 lakh, not deemed resident either; treaty-resident in the UAE
Phuket rental: Outside scope of Indian tax. Reported only on Thai PIT return.
Plan to move back: 2027, will trigger 2-3 year RNOR window
Tax strategy: Sell the Phuket condo during the RNOR window (Strategy 4 above), foreign capital gain remains outside Indian scope. Saves the 12.5% LTCG that would otherwise apply once ROR.
Schedule FA: Not required as NRI. Becomes mandatory the year residency status changes to ROR.

Scenario 2: NRI in Singapore, continuous, no return planned

Profile: an Indian citizen long settled in Singapore, owner of a Laguna condominium bought from Singapore earnings.

Current residency: NRI (clear-cut, treaty-resident in Singapore under India-Singapore 1994 DTAA)
Phuket rental: Outside scope of Indian tax. The Thai tax is the whole bill.
Schedule FA: Not required. No Indian filing obligation.
CRS exposure: the Thai bank reports to the country of tax residence declared on the self-certification, so the data goes to Singapore, not India, for a genuine NRI.
Repatriation if sold: to the Singapore account the purchase was funded from, against the FET records; the FEMA cap on NRO remittances is not in play for an NRI selling a foreign asset.
Tax strategy: Hold long-term. Pay the Thai exit costs at sale. No India-side liability.

Scenario 3: ROR moving back to India after 5 years overseas

Profile: an Indian citizen returning to Bangalore after five years in London, owner of a Kamala condominium bought from UK earnings.

Current residency: Becoming ROR by year-end (will spend over 182 days in India this FY), RNOR window applies for 2 years
Phuket rental: During RNOR years, foreign rental remains outside Indian scope. From year 3 onward, full Indian slab tax applies less DTAA credit.
Schedule FA: Mandatory from the year of return. Disclose property address, Chanote number, acquisition cost in INR (SBI TT rate at acquisition), year-end balance, rental income.
Tax strategy: Either sell during RNOR window (Scenario 1’s playbook) OR hold and structure rental through licensed Thai operator to keep Thai PIT documented for FTC at filing.
CRS risk: Highest, since the UK, Thailand and India all exchange; update the self-certification at the Thai bank when residence changes, because the data follows it.

For the underlying capital gains math behind Scenarios 1 and 3, see Strategy 1 and Strategy 4 above. For LRS limits applicable to Scenario 3 once ROR, see the LRS Scheme Thailand Property guide.

Risks and pre-ITR checklist for NRI Phuket owners

Schedule FA non-disclosure penalty (Black Money Act 2015): ₹10 lakh per asset per year of non-disclosure, accumulating across years, before the tax on the asset’s value and the penalty on that tax. The claim of an audit-trigger ranking the earlier version made here had no source.
CRS reporting cross-match risk: the Thai bank’s year-end balance, interest and gross proceeds reach the Indian side through the exchange; a mismatch with Schedule FA is what draws a notice. No timescale is promised here.
Currency risk on repatriation: proceeds in baht are converted at the rate of the day, and a rupee that has moved either way between purchase and sale moves the rupee gain with it. Ask your bank whether it will book a forward for a sale; no direction is forecast here.

Pre-ITR checklist for NRI / RNOR / ROR Phuket owners (run annually):

Residency status reconfirmed under Section 6: days in India counted, deemed-resident test under 6(1A) applied if Indian-source income exceeds ₹15 L.
Schedule FA pre-filled with country code TH, property address, Chanote number, acquisition value in INR at the prescribed rate on the acquisition date, peak balance and FY-end balance.
Schedule FSI populated with foreign rental income converted at the prescribed rate on the date of receipt.
Thai TRC (Tax Residency Certificate) requested from the Thai Revenue Department as a Form 67 attachment, early, because no processing time is promised.
Form 67 filed before ITR processing: claim FTC for Thai PIT against Indian slab tax. Without Form 67, no FTC = double tax.
Annual Information Statement (AIS) reviewed at incometax.gov.in for Thai bank pre-populations. Discrepancies between AIS and Schedule FA must be reconciled before filing.
All Thai documents English-translated and certified: tax receipts, Land Office withholding receipts, the Thai bank’s year-end statements. Required for Schedule HP workings and for Form 67.
CA cross-check completed by a CA who has filed Form 67 and Schedule FA for Thai income before.

The five red flags that should pause any annual filing: (1) Thai bank statement balance does not reconcile to Schedule FA peak; (2) Thai PIT receipts missing for any rental month claimed in Schedule FSI; (3) AIS shows a Thai bank account not yet disclosed; (4) DTAA Article reference incorrect on Form 67 (Article 6 for rental, Article 13 for capital gains); (5) Schedule HP omits municipal taxes paid in Thailand (Land and Building Tax) which are deductible.

For the inbound LRS / FEMA side underpinning purchase, see the LRS Scheme Thailand Property guide.

Related Indian-Cluster Guides:

Frequently Asked Questions

Do I have to file Indian ITR if I am NRI in Singapore and own a Phuket condo?

If you are a non-resident under Section 6 (under 182 days in India and not deemed resident under 6(1A)), you do NOT have to disclose the Phuket property in Schedule FA, and the rental income is not taxable in India. However, in any year you spend over 182 days in India (becoming Resident again), you must disclose the property and report rental income in that year's ITR-2. Many NRIs also voluntarily file an Indian ITR each year to keep continuity of PAN status and to claim DTAA benefits on Indian-source income.

What happens if I do not disclose my Phuket property in ITR Schedule FA?

Non-disclosure of a foreign property falls under the Black Money (Undisclosed Foreign Income and Assets) Act 2015, not the ordinary Income Tax Act: tax on the asset's value, a penalty on that tax, a fixed penalty of ₹10 lakh per asset per year, and prosecution provisions for wilful default. Thailand takes part in the Common Reporting Standard, so Thai bank data reaches the Indian side; the statements are registered on this site as unverified with a review date.

Can my CA in India handle Thai tax filing as well?

No. Thai PIT and Land Office withholding are filed locally in Thailand by a Thai accountant or your property manager (most rental management companies handle PIT for their owners). Your Indian CA handles your ITR-2, Schedule FA, Schedule FSI, and Form 67 (FTC claim). The two work in parallel: Thai filing first (gives you the PIT receipts and TRC), then Indian filing using those Thai documents as the basis for the FTC credit. Plan for both.

How does Thailand know I am Indian for CRS reporting?

Thai banks collect a self-certification of tax residence and a tax identification number at account opening, which for an Indian resident is the PAN. The bank reports to the Thai authority, which exchanges with the country on the self-certification. The data can then appear in your Annual Information Statement on the Indian income tax portal, which is worth reviewing before you file.

Can I gift the Phuket property to my parents to avoid capital gains tax?

A gift between Resident Indians is exempt from gift tax under Section 56(2) for specified relatives, but the cost basis carries over to the donee. When the parent eventually sells, they pay capital gains using your original cost basis and original date of acquisition. So the gift defers tax but does not avoid it. Additionally, if the parent is in a lower tax bracket and senior citizen exemptions apply, the effective rate may be lower, but you also lose access to your own Section 54F option. Talk to a CA before structuring.

Can I claim Section 80C deduction for home loan interest on a Phuket condo?

Section 80C principal repayment deduction (₹1.5 lakh) is available ONLY for loans secured against Indian residential property. A Phuket condo loan does not qualify. Section 24(b) interest deduction may be available on a let-out property abroad where the property and the loan are both in your name; confirm the point with your CA, because Indian banks rarely lend against Thai property and the question arises mainly with a Thai bank loan or a facility secured elsewhere.

Is GST or VAT applicable on Phuket rental income from the India side?

Indian GST does not apply to your Phuket rental, it is foreign-source service income for the Indian tenant (which there is not), so no GST registration is triggered. Thai VAT does not apply to long-stay residential rental (over 30 days). Short-stay (Airbnb-style) rental run through a hotel-licenced manager is subject to Thai VAT 7%, which the manager handles. From the Indian ITR perspective, only direct income tax (slab rate) applies on your share of net rental, no GST layer.