Call Us

FOR EXISTING POLICY

Have query on premium, payout or any servicing need?

Call us:

1 860 266 9966

Monday - Saturday | 10 am - 7 pm IST

Call charges apply

Dedicated NRI Helpdesk:

+91 22 6251 9966

Monday - Saturday | 10 am - 7 pm IST

Call charges apply

FOR NEW POLICY

Want to buy a new policy online?

Call us:

+91 22 6984 9300

Give missed call for a call back:

+91 11 6615 8748

Monday - Sunday | 8 am - 11 pm IST


Exclusively for NRIs:

Call us:

Give missed call for a call back:

+91 11 4473 0242

Monday – Sunday | 9 am – 9 pm IST

Language

Need assistance in choosing the right insurance plan? Get a call from our Expert.

Need assistance in choosing the right insurance plan?Get a call from our Expert.

+91 dropdown arrow

Select Plan dropdown arrow
  • Term plans
  • Saving plans
  • Wealth plans
  • Retirement plans
  • I don't know/I need help

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in. T&C apply.

What Are The Taxation Rules For People With Dual Citizenship?

Being a citizen of a country gives you a host of rights and privileges that you can exercise within the purview of the law. However, it also comes with several duties and responsibilities that you must fulfil.
 

Some countries also enable their citizens to procure the citizenship of another country while retaining their current citizenship. But does that also apply to Indian citizens? This blog can help you understand the concept of dual citizenship in India and the different taxation rules that apply to them.

What is Dual Citizenship?

Dual citizenship means an individual can have more than one nationality, granting them country-specific rights and benefits. For example, individuals with dual or multiple citizenship can work, study, and reside in both countries.
 

This also gives one access to quality privileges such as education, healthcare, social security, and more.
 

Furthermore, individuals with dual citizenship can hold multiple passports, which enables them to travel easily. Hence, they can enjoy the benefit of visa-free travel to most countries.

Is Dual Citizenship in India Permissible?

The Indian Constitution offers no provisions for dual or multiple citizenships. However, an Indian can choose to acquire a second passport from another country, but doing so requires them to surrender their Indian citizenship.
 

Under the Passports Act of 1967, it is mandatory for every Indian resident to surrender their Indian passport to the nearest embassy if they acquire citizenship in another country.
 

After obtaining foreign citizenship, Indians are required to obtain Overseas Citizens of India (OCI) status.
 

To acquire dual citizenship, one must meet these requirements:
 

  1. According to Articles 5, 6, and 8, individuals who voluntarily apply for citizenship of a foreign state will cease to be Indian citizens.

  2. The individual will assume the nationality of the foreign state for which they have applied for citizenship.

  3. Individuals must surrender their Indian passports and any other documents establishing their Indian citizenship at the nearest Indian embassy.

Although India does not have dual citizenship provisions, individuals can obtain an OCI card, which offers multiple benefits. However, let us check what tax rules apply to them before delving into the OCI benefits.

Taxation Rules for OCI Holders

  1. An OCI's foreign income and interests from non-resident rupee bank accounts are exempt from taxation, while income from Indian sources is subject to Indian taxes.

  2. Taxability in India is determined by the period of time an individual stays in India, which helps establish their residential status.

  3. If a person visits India and stays for more than 182 days in a financial year (e.g., 2017-18), they will be liable to pay dual citizen tax in India.
     

Tax Exemptions from Income Tax

  1. When it comes to the income tax rules for NRIs and PIOs, they exempt from investment taxation, such as deposits in:

  • Non-Resident External Rupee Accounts (NRE) and Foreign Currency Non-resident Accounts (FCNR)
     

Tax Exemptions from Wealth Tax

  1. When OCIs return to India for permanent residence, there will be no wealth tax imposed on the assets brought from their respective foreign countries for a period of 7 years.

  2. The current wealth tax rate is 1% and will be leviable on the amount in excess of Rs. 30 lakhs of the Net wealth as of March 31st each year.

Important Points to Remember

  1. Interested and eligible individuals can apply for the OCI scheme through the online portal www.mha.nic.in.

  2. If the application form is filled in India, the application fees are to be paid via a Demand Draft:

    • General category: ₹15,000

    • PIO holders: ₹1,400

    • Minor PIO cardholders: ₹8,000

  3. Normally, OCI registration takes 30 days to be granted, but it can take up to 120 days if further clarification is required.

  4. Applicants granted registration under the OCI scheme receive an OCI Registration Certificate and a lifelong visa sticker on their foreign passports.

Benefits for Registered Overseas Citizens of India (OCI)

  1. OCIs can visit India anytime, for any purpose and duration, without a separate work permit. They can do so with a ‘U’ visa.

  2. They are entitled to equal treatment as any non-resident Indian with respect to financial, economic, and educational matters, except for investment in agriculture and plantation properties.

  3. OCIs can stay in India for any period without reporting to authorities or registering with the police.

  4. OCI holders must pay the same entry fees as Indian nationals for visiting museums, monuments, national parks, and sanctuaries in India.

  5. They are charged the same tariffs for domestic flights as Indian citizens.

  6. An OCI holder can practice as a doctor, lawyer, CA (Chartered Accountant), or architect in India without discrimination against Indian citizens.

Eligibility Criteria to Apply Under the OCI Scheme

  1. Individuals who were eligible to be citizens of India as of January 26, 1950, but are foreign citizens.

  2. Individuals who became Indian citizens on or after January 26, 1950, but are foreign citizens.

  3. Persons who belonged to a part of Indian territory after August 15, 1947, but were foreign citizens.

  4. Children, grandchildren, or great-grandchildren of any of the above citizens.

  5. Minors can also be eligible to apply for an OCI card.

Restrictions for OCI Holders

  1. They cannot hold an Indian passport or cast votes.

  2. They cannot be candidates for Lok Sabha or Rajya Sabha (Indian Parliament).

  3. OCI holders cannot work as employees in the Government of India.

Under the Citizenship Act of 1955, an OCI holder can be granted Indian citizenship if they are registered as an OCI for five years and have resided in India for at least one year within that period.
 

Among the other benefits OCIs and NRIs enjoy, one can also purchase an NRI insurance policy of their choice in India. With an NRI insurance plan, they can pay the premiums either in Indian currency or secure their family members under a single comprehensive insurance plan.

When it comes to selecting, such as policy as per your preference, Tata AIA Life Insurance company ensures that you have ample options in life insurance, complete with multiple choices in life cover, premium payment options, the ease of an online purchase and tax benefits on the policy.

Conclusion

Dual nationality in India has several benefits. But one should also consider all the tax implications of having dual citizenship as an OCI cardholder. This enables better tax planning for OCIs to boost their investments and access life insurance benefits in India.

Want to Keep More of Your Hard-Earned Money? Speak to out expert

+91 dropdown arrow
  • +93 Afghanistan

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in.


 

Looking to buy a new insurance plan?

Our experts are happy to help you!

+91

Select plan
  • Term plans
  • Saving plans
  • Retirement plans
  • Wealth plans
  • I don't know/I need help

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in

People Like You Also Read

How Can You Grow Wealth and Save Tax Simultaneously?
Read More
Earn 1 Crore in 5 Years - Expert Tips & Strategies
Read More
How to Read ULIP Plan Benefit Illustration
Read More
4G ULIP vs. Mutual Fund – Which is the Best Investment Option? | Tata AIA Blog
Read More
Tips to Choose the Best Performing ULIPs in India 2024 | Tata AIA
Read More
What is a 4G ULIP? | Tata AIA Blog
Read More
What Are EET, ETE, & EEE Investment Options? | Tata AIA
Read More
Is PAN Card Necessary for Investment?
Read More
How To File Itr As An Oci On Indian Income
Read More

People Like You Also Read

How Can You Grow Wealth and Save Tax Simultaneously?
Read More
Earn 1 Crore in 5 Years - Expert Tips & Strategies
Read More
How to Read ULIP Plan Benefit Illustration
Read More
4G ULIP vs. Mutual Fund – Which is the Best Investment Option? | Tata AIA Blog
Read More
Tips to Choose the Best Performing ULIPs in India 2024 | Tata AIA
Read More
What is a 4G ULIP? | Tata AIA Blog
Read More
What Are EET, ETE, & EEE Investment Options? | Tata AIA
Read More
Is PAN Card Necessary for Investment?
Read More
How To File Itr As An Oci On Indian Income
Read More
Website Logo Image Icon

Tata AIA Life Insurance

A joint venture between Tata Sons Pvt. Ltd. and AIA Group Ltd. (AIA),  Tata AIA Life Insurance  is one of the leading life insurance providers in India. We post everything you need to know about life insurance, tax savings and a variety of lateral topics such as savings and investments in this space. You can access and read a host of different blogs, articles and pages at the Tata AIA Life Insurance Knowledge Center or get in touch with us with any queries or questions!

View all posts by Tata AIA Life Insurance

Frequently Asked Questions

How are foreign nationals taxed in India?

Foreign income, which is income earned or arising outside of India for a financial year, attracts income tax for that year. This is irrespective of whether the income was received in India or brought to the country. The income tax cannot be avoided, even if the foreign country imposes restrictions on the remittance of income.

What is the penalty for holding two Indian passports?

Only government servants and diplomats may have multiple passports. In any other case, it is an offence under the Passport Act for Indian citizens to have two passports. The penalty for such an act, under Section 12(1)(b)(xv) of the Passport Act, is a fine of ₹5000/- and/or imprisonment for up to 3 months.

Disclaimers

  • Insurance cover is available under the product.

  • The products are underwritten by Tata AIA Life Insurance Company Ltd.

  • The plans are not a guaranteed issuance plan, and it will be subject to Company’s underwriting and acceptance.

  • For more details on risk factors, terms and conditions please read the sales brochure carefully before concluding a sale.

  • This blog is for information and illustrative purposes only and does not purport to any financial or investment services and do not offer or form part of any offer or recommendation. The information is not and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.

  • Please know the associated risks and the applicable charges, from your Insurance agent or the Intermediary or policy document issued by the insurance company.

  • Every effort is made to ensure that all information contained in this blog is accurate at the date of publication, however, the Tata AIA Life shall not have any liability for any damages of any kind (including but not limited to errors and omissions) whatsoever relating to this material.

  • Tax: *Income Tax benefits would be available as per the prevailing income tax laws, subject to fulfilment of conditions stipulated therein. Income Tax laws are subject to change from time to time. Tata AIA Life Insurance Company Ltd. does not assume responsibility on tax implications mentioned anywhere in this document. Please consult your own tax consultant to know the tax benefits available to you.