Salary paid by Indian Employer to Foreign citizen abroad


This query is : Resolved 

18 November 2008 Indian Employer employing a Dubai Citizen for rendering services in Dubai. Salary being remitted to him from India. Would like to know the income tax implications on the income earned by him. Is this taxable here in India or in Dubai? Moreover, Personal income tax is exempt in Dubai, hence is this income taxable in India?

18 November 2008 it is taxable in india and tax need to deducducted and if tds is not deducted then exp will not be allowed u/s 40(a)(iii).

18 November 2008 The scope of taxability of total income depending on the residential status (Sec 5):
1) Income accruing or arising or deemed to accrue or arise outside India, but first receipt is outside India, during the current FY - ROR - Taxable; RNOR - Not taxable; NR - Not taxable.

2) Income accruing or arising outside India from any source other than Business / Profession controlled from India - ROR - Taxable; RNOR - Not taxable; NR - Not Taxable.

19 November 2008 Dubai Citizen being a Non-Resident, does the salary income earned by him for rendering services in Dubai however receiving the same from Indian Employer (Receipt in Dubai) taxable in India??? Does this imply that it is accruing or arising in India since paid by an Indian employer??


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