Dividend received from foreign company
This query is : Resolved
Quick Summary
20 June 2021
Dear sir,
Indian resident have received the dividend from foreign company, however initially such dividend was transferred to Escrow and later Assessee has encashed it in different year, and also income summary statement (form 1042-S)captures this income the year in which it (dividend) transferred to Escrow A/c. Form 1042-S shows that dividend income is exempted in USA, hence no tax is deducted in USA for this Income.
Question.
1. is this income is taxable in India ?
2. If taxable in the sense in which it has to be taxed? ( dividend transferred to Escrow A/c FY 209-20 but Assessee encashed in FY 2020-21)
3. Is there any relief available for this income?
Please give your valuable opinion on this issue.
Thanks in advance
Indian resident have received the dividend from foreign company, however initially such dividend was transferred to Escrow and later Assessee has encashed it in different year, and also income summary statement (form 1042-S)captures this income the year in which it (dividend) transferred to Escrow A/c. Form 1042-S shows that dividend income is exempted in USA, hence no tax is deducted in USA for this Income.
Question.
1. is this income is taxable in India ?
2. If taxable in the sense in which it has to be taxed? ( dividend transferred to Escrow A/c FY 209-20 but Assessee encashed in FY 2020-21)
3. Is there any relief available for this income?
Please give your valuable opinion on this issue.
Thanks in advance
CA R SEETHARAMAN
(Expert)
20 June 2021
1 yes, it's taxable in India.
2 Dividend taxable in the year of amount received.
3 Dividend received from a foreign company gets taxed both in India and in the home country of the foreign company. However, if the tax on an international company's dividend has been paid twice (i.e. paid in both the nations), then the taxpayer can claim double taxation relief.
2 Dividend taxable in the year of amount received.
3 Dividend received from a foreign company gets taxed both in India and in the home country of the foreign company. However, if the tax on an international company's dividend has been paid twice (i.e. paid in both the nations), then the taxpayer can claim double taxation relief.
26 June 2021
Hi sir,
dividend transferred to Escrow account in 2019-20 but this dividend encashed it in 2020-21, you mean to say this income is taxable in the year 2019-20 it self?
dividend transferred to Escrow account in 2019-20 but this dividend encashed it in 2020-21, you mean to say this income is taxable in the year 2019-20 it self?
CA R SEETHARAMAN
(Expert)
26 June 2021
Who's escrow account.
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