TAXABILITY OF FOREIGN PENSION RECIEVED BY RNOR

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This discussion clarifies whether foreign pension income received by a Resident but Not Ordinarily Resident (RNOR) in India is taxable in India, even if directly deposited into an Indian bank account. The consensus is that income accruing and arising outside India for an RNOR is generally not taxable in India, and can be disclosed under exempt income. Relief may be available for taxes already paid abroad.

pratiksha

pratiksha (Querist)
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23 June 2021 I have a doubt. Suppose Mr.X , a resident but non ordinary resident, receives his superannuation pension income from Australia after deduction of tax by Australian govt. at the rate 35% . The pension income is deposited by the govt. directly in Mr. X's A/C in a Bank say IDBI Bank in India and it is not deposited in any bank account in Australia. The pension income accrues and arises from Australia.My doubt is that whether the pension income credited to Mr.X's bank account in India is taxable in India as income of RNOR received or deemed to be received in India???? Also please give relevant IT sections and case laws if possible...Since the RNOR is not having any bank account in australia, it is deposited in his account in India. So can any relief be claimed for the same??????

One more Kind request...Pls give me the applicable sections and case laws too if possible to justify ur answer..It will help me to an great extent

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 June 2021 An RNOR in India will continue to enjoy tax benefits like an NRI. They will be taxed only on income earned in India, unlike Indian residents who have to pay tax on global income.
It's not taxable even the money is deposited in Indian Bank account.

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pratiksha

pratiksha (Querist)
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23 June 2021 sir as per which section it is not taxable
or do we have to disclose this under RNOR ITR

pratiksha

pratiksha (Querist)
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23 June 2021 and case laws too if possible to justify ur answer..It will help me to an great extent

pratiksha

pratiksha (Querist)
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23 June 2021 sir, it is directly credited in the Indian bank account why it does not fall under section 5

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 June 2021 See the link.

https://www.google.com/url?sa=t&source=web&rct=j&url=https://assets.kpmg/content/dam/kpmg/in/pdf/2017/11/KPMG-Flash-News-Income-earned-abroad-by-a-non-resident-cannot-be-taxed-in-India-2.pdf&ved=2ahUKEwjb44HByq3xAhU9xDgGHcpFBOYQFjAMegQIHhAC&usg=AOvVaw2hVS1Ucm2ulWCQ0IEXJXwY

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pratiksha

pratiksha (Querist)
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07 September 2021 will this foreign pension disclose under exempt income? and what description to be made

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 September 2021 Yes, you can disclose it under other exempt income.

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pratiksha

pratiksha (Querist)
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07 September 2021 thank you so much sir
description: foreign pension accrues and arise outside India received by resident but not ordinarily resident after deduction of tax

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 September 2021 Yes, opt description.

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