- You can keep US shares bought while resident; NRIs are not taxed in India on them.
- Every resident-year return should show them in Schedule FA; FY 2025-26 can be revised free until 31 December 2026.
- File a new W-8BEN within 30 days of moving; Dubai residents face 30% US dividend withholding.
Can I keep US shares bought while I was resident in India?
Yes. Under FEMA, a person resident outside India may continue to hold foreign assets acquired while resident in India. You do not need to sell. Update your status and address with the investing platform and its US broker, because some platforms limit service to residents of certain countries.
Once you are a non-resident under FEMA, the Liberalised Remittance Scheme no longer governs fresh investment. You can invest from your foreign salary directly, and no Indian TCS applies to money that never leaves an Indian bank.
How the shares are taxed in India
| Your status for the year | US dividends and gains | Schedule FA |
|---|---|---|
| Resident and ordinarily resident | Taxable in India. Gains after 24 months: 12.5%. Earlier: slab rates. Credit for US tax withheld (Form 67) | Required |
| Resident but not ordinarily resident (RNOR) | Generally not taxable in India | Not required |
| Non-resident | Not taxable in India | Not required |
US shares are not listed on an Indian stock exchange, so Indian tax treats them like unlisted shares: long-term after 24 months. Your status is decided for each financial year as a whole, so the year you move is often still a resident year. See residential status and RNOR.
Schedule FA for the years you were resident
- Every return filed as a resident should list the US shares, the brokerage account and the dividends in Schedule FA, even if you sold nothing.
- Schedule FA follows the calendar year. The FY 2025-26 return (AY 2026-27) covers holdings from 1 January to 31 December 2025.
- Omitting it can attract a ₹10 lakh penalty per year under the Black Money Act. Since 1 October 2024, this is not applied where your foreign assets other than property total ₹20 lakh or less. Above that, the relief is lost.
How to fix a missed disclosure
| Year | Route | Last date |
|---|---|---|
| FY 2025-26 (AY 2026-27) | Revised return with Schedule FA | 31 December 2026 with no fee; up to 31 March 2027 with a fee of ₹1,000 or ₹5,000 |
| Earlier years | Check eligibility for FAST-DS (shares bought from taxed income: flat ₹1 lakh) | 31 December 2026 |
| Unreported dividends or gains | Updated return (ITR-U) with additional tax | Depends on the year; see ITR-U time limits |
Update your W-8BEN with the US broker
Your W-8BEN tells the US broker which country you are tax resident in. If that changes, you must give a new form within 30 days. This changes the US tax withheld on dividends:
- As an Indian resident, the India-US tax treaty limits dividend withholding to 25%.
- The US has no income tax treaty with the UAE, so a Dubai resident generally suffers the full 30%.
- Residents of the UK, Singapore, Canada and others get their own treaty rate.
US estate tax: often missed
For people who are not US citizens or residents, US shares are US assets for US estate tax. The exemption is only US$60,000, whatever country you live in. On a large US portfolio, plan for this, and keep nominee details current with the platform.
Checklist when you move abroad
- Confirm your residential status for the year of the move and the next year.
- Check Schedule FA in every return filed as a resident while you held the shares.
- Update the platform and the US broker: country of residence, address and a new W-8BEN.
- Keep statements of cost and dates for every lot, for the gain computation if you return.
- Plan for US estate tax if the portfolio is large.
Related: investing in US stocks from India, moved to Dubai: NRI checklist and FAST-DS for returning NRIs.
Sources
- IRS: About Form W-8BEN
- IRS: United States income tax treaties, A to Z
- IRS: Some nonresidents with US assets must file estate tax returns
- Income Tax Department: FAST-DS FAQs
- Legal500 (S&A Law Offices): Union Budget 2026-27, direct tax
Frequently asked questions
Can an NRI keep US stocks bought while resident in India?
Is an NRI taxed in India on US stock gains and dividends?
Do NRIs need to fill Schedule FA?
What US tax is withheld on dividends after moving to Dubai?
Do I need a new W-8BEN after moving abroad?
Please note: this guide is general information based on the rules as they stood on the review date above. Regulations and RBI/CBDT procedures change often — please get advice on your specific facts before acting.