Double taxation

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Priya Jyothish (Querist)
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28 June 2012 An Assessee is a resident but not ordinarily resident. He has interest income from deposits in Australia. Tax is deducted on such income in Australia. I want to know the tax treatment of such Interest?

Arihanth Jain

Arihanth Jain (Expert)
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29 June 2012 Such interest income taxable in India. However credit of taxes borne abroad can be availed.

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Priya Jyothish

Priya Jyothish (Querist)
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29 June 2012 here, the other country is australia and tax has been deducted from such interest

Priya Jyothish

Priya Jyothish (Querist)
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29 June 2012 ok sir, But since he is a not ordinarily resident, liability of tax in india arises only if such income is from a business controlled in or a profession set up in India. this interest income is from a savings bank deposit. that means other sources. it is stated that dtaa overrides income tax act. but whether the concept of double taxation arise in such a case is my question.. (as it is not taxable in india)

Arihanth Jain

Arihanth Jain (Expert)
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30 June 2012 In that case consider looking into the source of such deposits. In case if the deposits are made out of surplus from the business/prof, then the income shall be taxable. Either way in my view it will be difficult to argue on this version to conclude that income is not taxable in India.

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Priya Jyothish

Priya Jyothish (Querist)
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30 June 2012 Source is australia only. he was a salaried person over there. if the income has to be taken in india, which date should be taken for determining foreign exchange conversion rate? interest is credited monthly to his account.

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