Exemption on ADB consultant remuneration

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This discussion clarifies the taxability of remuneration received by consultants from the Asian Development Bank (ADB) in India. While ADB salaries are generally exempt from tax under the ADB Act, 1966, which supersedes the Income Tax Act, a specific declaration by the Indian government states that India reserves the right to tax salaries paid to its own citizens. Therefore, Indian citizens working as ADB consultants in India are liable to pay income tax on their remuneration.

Guest

Guest (Querist)

07 September 2021 Is the remuneration received by consultants in India from Asian Development Bank subject to income tax.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 September 2021 Salaries and emoluments paid by the Asian Development Bank is exempt from tax in india like the provisions contained in the UN (Privileges and Immunities) Act, 1947. The provisions of the said ADB Act, 1966 supersede the provisions of the Income Tax Act.

Guest

Guest (Querist)

07 September 2021 I did come across this declaration "The Government of India declares that India retains for herself and her political subdivision the right to tax salaries and emoluments paid by the Asian Development Bank to citizens or nationals of India.".
https://treaties.un.org/pages/ViewDetails.aspx?src=TREATY&mtdsg_no=X-4&chapter=10&clang=_en#EndDec

The declaration suggests that indian citizens are liable to pay taxes. Please advise.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 September 2021 In such a case Indian residents are liable to pay taxes.

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