How to present Indian Income of NRI
This query is : Resolved
20 February 2024
Sir,
An individual NRI who is tax resident in US, is required to report his Indian income while filing his return in USA.
The income generated in India is mainly from of Bank Interest and Interest accrued in PPF in a case .Now since this is not much amount , and therefore no use of availing benefit of double taxation as it involves various compliances also. So better to pay tax in India in a normal procedure/ and rates . But in India TDS is deducted by bankers at prescribed rates and while filing of tax return some refund is generated as actual tax liability after exemptions/deductions in India will be less than TDS deducted by bankers here.. In foreign country this gross interest is added ( after conversion in their currency ) as part of income statement there.
Hence following queries:-
1.While filing return in USA ' Tax Paid ,is required to be reported. Now what should be reported . Is it actual TDS on gross total interest income or is it net taxpaid in India on Total Income .i.e liability calculated after exemptions deductions. ?
2. If in any case Tax payable on Total Income is less than TDS , then refund arises. In this case also Is it TDS to be reported or NIL tax is to be reported. But here it is not possible to report nil as TDS already appears in Bank Statements and amount of tax liability on Total Income differs from that amount of TDS.
In US financial year is calendar year whereas in India it is April -March so it is also not possible to proportionate the tax paid if any. So how it can be correlated / appropriated /reported there.
3. Financial year is. Calendar Year ;at that place whereas in India it is from April-March. Therefore it necessitates to adjust India income for one quarter each year to make is as per Calendar Year . What is appropriate in such situation. Is it good to report as per IT return in India i.e. as per Financial/Assessment year OR to adjust figures as per calendar year and and make it usable figure for reporting purposes there
4. Is there any specific guidelines on these issues ?
Pls guide.
An individual NRI who is tax resident in US, is required to report his Indian income while filing his return in USA.
The income generated in India is mainly from of Bank Interest and Interest accrued in PPF in a case .Now since this is not much amount , and therefore no use of availing benefit of double taxation as it involves various compliances also. So better to pay tax in India in a normal procedure/ and rates . But in India TDS is deducted by bankers at prescribed rates and while filing of tax return some refund is generated as actual tax liability after exemptions/deductions in India will be less than TDS deducted by bankers here.. In foreign country this gross interest is added ( after conversion in their currency ) as part of income statement there.
Hence following queries:-
1.While filing return in USA ' Tax Paid ,is required to be reported. Now what should be reported . Is it actual TDS on gross total interest income or is it net taxpaid in India on Total Income .i.e liability calculated after exemptions deductions. ?
2. If in any case Tax payable on Total Income is less than TDS , then refund arises. In this case also Is it TDS to be reported or NIL tax is to be reported. But here it is not possible to report nil as TDS already appears in Bank Statements and amount of tax liability on Total Income differs from that amount of TDS.
In US financial year is calendar year whereas in India it is April -March so it is also not possible to proportionate the tax paid if any. So how it can be correlated / appropriated /reported there.
3. Financial year is. Calendar Year ;at that place whereas in India it is from April-March. Therefore it necessitates to adjust India income for one quarter each year to make is as per Calendar Year . What is appropriate in such situation. Is it good to report as per IT return in India i.e. as per Financial/Assessment year OR to adjust figures as per calendar year and and make it usable figure for reporting purposes there
4. Is there any specific guidelines on these issues ?
Pls guide.
21 February 2024
1 Net tax paid on Indian income is to be reported.
2 Net tax paid to be reported. No need for appropriated. Correlate it with the calendar year.
3 No need for any bifurcation correlate it and report it.
For example report April 22 to March 23 income in calendar year 22 of US.
2 Net tax paid to be reported. No need for appropriated. Correlate it with the calendar year.
3 No need for any bifurcation correlate it and report it.
For example report April 22 to March 23 income in calendar year 22 of US.
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21 February 2024
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