Nri
This query is : Resolved
11 July 2013
Income earned in abroad remitted to India. whether taxable in India? If not, TDS is deducted on NRO account whether it can be claimed back as salary is earned in abroad then remitted to India is not taxable.
11 July 2013
It depends upon the residential status of the assessee. If he is NRI the salary income earned out of India will not be taxable. TDS deducted can be claimed by filing his return.
06 September 2017
Does it matter that salary is transferred direclty to bank account in India. Whether it can be made taxable on the context that it is received in india although he could have received the salary in abroad also then remit to bank account in india but it has been transferred directly to bank account in India as a matter of convenience. His residential status is NRI.
03 August 2024
### Taxation of Income Earned Abroad and Remitted to India
**1. **Income Earned Abroad and Taxability in India**
- **Residential Status:** Since the individual is an NRI (Non-Resident Indian), their income earned abroad is generally not taxable in India, provided it is not related to a business or profession carried out in India.
- **Income Not Taxable:** Income earned abroad, such as salary, is not taxable in India if the individual is an NRI. The key factor is the residential status and not the place where the income is transferred.
**2. **Remittance of Foreign Income to India**
- **Not Taxable in India:** The mere remittance of income earned abroad to an NRO (Non-Resident Ordinary) account or any account in India does not make the income taxable in India. The taxability of income is determined based on the source and nature of the income, not on where it is deposited.
- **Source of Income:** As long as the income was earned outside India and the individual is an NRI, it remains non-taxable in India.
**3. **TDS on NRO Account**
- **TDS on NRO Account:** TDS (Tax Deducted at Source) on an NRO account is typically related to income earned or accrued in India, such as interest income from deposits or rental income. TDS is not generally applicable to income earned abroad.
- **Claiming Refund:** If TDS has been deducted on an NRO account and the income is not taxable in India, you can file a tax return in India to claim a refund of the TDS. The refund process involves filing a tax return, showing that the income is not taxable.
**4. **Direct Transfer of Salary to an Indian Account**
- **Impact on Taxability:** The direct transfer of salary earned abroad to an Indian bank account does not affect its taxability in India. The income remains non-taxable in India based on the residential status of the individual and the source of the income.
- **Convenience Factor:** The fact that the salary is transferred directly to an Indian account as a matter of convenience does not change its nature. The income is considered to be earned abroad and is therefore not subject to Indian tax laws if the individual is an NRI.
**5. **Practical Steps and Considerations**
- **Verify Residential Status:** Confirm your NRI status and ensure that your income earned abroad is categorized correctly.
- **File Tax Returns:** If TDS has been deducted on your NRO account or if you need to show that the income earned abroad is not taxable in India, file a tax return in India to claim any potential refunds.
- **Consult a Tax Professional:** It is advisable to consult with a tax professional who can assist in ensuring compliance with both Indian and international tax laws, and to handle any specific issues related to TDS refunds or tax filings.
### **Summary**
- **Income Earned Abroad:** Generally not taxable in India for NRIs.
- **Remittance to India:** Does not affect the taxability of foreign income.
- **TDS on NRO Account:** Can be claimed as a refund if the income is not taxable in India.
- **Direct Transfer:** Does not impact the tax status of the income.
By following these guidelines, you will ensure that you meet all relevant tax obligations and avoid any unnecessary taxation.
**1. **Income Earned Abroad and Taxability in India**
- **Residential Status:** Since the individual is an NRI (Non-Resident Indian), their income earned abroad is generally not taxable in India, provided it is not related to a business or profession carried out in India.
- **Income Not Taxable:** Income earned abroad, such as salary, is not taxable in India if the individual is an NRI. The key factor is the residential status and not the place where the income is transferred.
**2. **Remittance of Foreign Income to India**
- **Not Taxable in India:** The mere remittance of income earned abroad to an NRO (Non-Resident Ordinary) account or any account in India does not make the income taxable in India. The taxability of income is determined based on the source and nature of the income, not on where it is deposited.
- **Source of Income:** As long as the income was earned outside India and the individual is an NRI, it remains non-taxable in India.
**3. **TDS on NRO Account**
- **TDS on NRO Account:** TDS (Tax Deducted at Source) on an NRO account is typically related to income earned or accrued in India, such as interest income from deposits or rental income. TDS is not generally applicable to income earned abroad.
- **Claiming Refund:** If TDS has been deducted on an NRO account and the income is not taxable in India, you can file a tax return in India to claim a refund of the TDS. The refund process involves filing a tax return, showing that the income is not taxable.
**4. **Direct Transfer of Salary to an Indian Account**
- **Impact on Taxability:** The direct transfer of salary earned abroad to an Indian bank account does not affect its taxability in India. The income remains non-taxable in India based on the residential status of the individual and the source of the income.
- **Convenience Factor:** The fact that the salary is transferred directly to an Indian account as a matter of convenience does not change its nature. The income is considered to be earned abroad and is therefore not subject to Indian tax laws if the individual is an NRI.
**5. **Practical Steps and Considerations**
- **Verify Residential Status:** Confirm your NRI status and ensure that your income earned abroad is categorized correctly.
- **File Tax Returns:** If TDS has been deducted on your NRO account or if you need to show that the income earned abroad is not taxable in India, file a tax return in India to claim any potential refunds.
- **Consult a Tax Professional:** It is advisable to consult with a tax professional who can assist in ensuring compliance with both Indian and international tax laws, and to handle any specific issues related to TDS refunds or tax filings.
### **Summary**
- **Income Earned Abroad:** Generally not taxable in India for NRIs.
- **Remittance to India:** Does not affect the taxability of foreign income.
- **TDS on NRO Account:** Can be claimed as a refund if the income is not taxable in India.
- **Direct Transfer:** Does not impact the tax status of the income.
By following these guidelines, you will ensure that you meet all relevant tax obligations and avoid any unnecessary taxation.
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