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The Big Beautiful Bill is here – Key Takeaways for NRIs

  • arjunveersingh
  • Jul 11
  • 2 min read

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Former U.S. President Donald Trump’s much-hyped “Big, Beautiful Bill” has finally cleared Congress—and it’s stirring up headlines across the world. While the bill has a wide-reaching impact on tax structures and economic priorities, one of the most notable aspects for Indian Americans and NRIs is the change in remittance taxation.


Let’s break down what’s inside the bill, and more importantly, what it means if you’re an NRI sending money back home.


Key Highlights of the “Big, Beautiful Bill”


1. Remittance Tax Reduced

  • Proposed: A 5% tax on outbound remittances from the U.S.

  • Passed: Final remittance tax has been slashed to just 1%

  • Applies to: Non-bank or card-based money transfers (like apps and digital platforms)


2. Rental Income Clarifications

  • Rental income earned in the U.S. by foreign nationals remains taxable under current IRS rules.

  • Relief can be sought via the U.S.-India Double Taxation Avoidance Agreement (DTAA), if also taxed in India.


3. Capital Gains on Indian Property

  • Selling property in India remains under existing capital gains tax rules.

  • However, repatriated earnings post-2025 may face new scrutiny or potential surcharges.


What It Means for NRIs


✅ Major Relief on Remittance Tax


The biggest win is the reduction from 5% to 1% on remittance tax. For those regularly sending money back to India, this significantly reduces the cost burden. A 5% fee on $10,000 would have meant $500 in taxes—now, it’s just $100.

This helps:

  • Middle-class NRIs sending money for family needs

  • Students supporting households back home

  • Professionals investing in Indian businesses or property


💸 Time Big Transfers Before 2025


While the 1% rate is a relief, it’s still a new cost that wasn’t there before. If you're planning a large one-time transfer—say, for buying a house, repaying a family loan, or investing—it may be wise to do so before December 31, 2025, when further updates or surcharges might be introduced.


🧾 File Right & Claim DTAA Benefits


For rental income or dual-income sources, NRIs must ensure proper filings to avoid double taxation. Leverage the India-US DTAA clause and consult a tax advisor to claim benefits.


🏠 Reassess Your Property Strategy


If you’re holding or selling property in India, be aware of potential repatriation challenges in the future. Start paperwork early, track policy updates, and consult a cross-border tax specialist.

 
 
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