Provisions not to apply if the assessee so chooses
[Section-218 as per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]
Section 218(1) of Income Tax Act 2025
218(1) A non-resident Indian may choose not to be governed by the provisions of sections 212 to 217 for any tax year by declaring it in his return of income under section 263 for such tax year. and if he does so,—
- (a)the provisions of sections 212 to 217 shall not apply to him for that tax year, and
- (b)his total income for that tax year shall be computed and charged to tax according to the other provisions of this Act.
FAQs on Section 218 of Income Tax Act 2025
Who can choose not to be governed by the provisions of sections 212 to 217?
A non-resident Indian (NRI) may choose not to be governed by these provisions.
How can an NRI opt out of sections 212 to 217?
The NRI must declare their choice in the return of income filed under section 263 for the relevant tax year.
What happens once an NRI makes this choice in their return?
Once the choice is declared, sections 212 to 217 will not apply to that NRI for that tax year.
How will the total income of the NRI be computed if they opt out of sections 212 to 217?
Their total income will be computed and taxed according to the other provisions of the Income Tax Act, 2025.
Is the choice to opt out of sections 212 to 217 valid for more than one year?
No, the choice is applicable only for the specific tax year for which it is declared in the return of income.
Is there any restriction on opting out again in subsequent years?
No such restriction is mentioned; the NRI may choose to opt out in each year separately by making the appropriate declaration.
Does the declaration need to be filed separately or within the return of income?
The declaration must be made within the return of income filed under section 263.
Can a resident Indian use this option under section 218(1)?
No, this option is specifically available only to non-resident Indians.
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