Taxability with reference to DTAA

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This discussion addresses the tax implications for an individual who was formerly an Indian resident, has now become an Australian citizen, and is applying for an OCI card. The individual has been filing tax returns in both India and Australia. The core question revolves around whether their current tax filing practices comply with the Double Taxation Avoidance Agreement (DTAA) between India and Australia, especially concerning income earned in each country. The advice clarifies that as an Australian resident, income earned in Australia should be declared there, and income earned in India may need to be declared in Australia with a rebate claimed for Indian taxes paid, or vice versa, to prevent double taxation as per DTAA provisions.

RAJEEV KUMAR MEHTA

RAJEEV KUMAR MEHTA (Querist)
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06 May 2025 Sir,

A resident indian has become Australian citizen and OCI card is being applied for! Has been filing IT return both in India and Australia for respective income.

Income in India is below taxable limit and accordingly TDS gets refunded.
Similarly Income in Australia is filed against Australian Tax Code and due tax is paid.

Request advice whether this complies with due process specially with reference to DTAA.

Would appreciate the kind guidance.

Thanks & Regards

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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06 May 2025 Whether he is resident Indian as per sec. 6 of IT act?

RAJEEV KUMAR MEHTA

RAJEEV KUMAR MEHTA (Querist)
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06 May 2025 Sir
Was a Resident Indian few years ago. Subsequently went to Australia with Permanent Residency and has now acquired Australian Citizen ship and OCI card is being applied for.
Trust this clarifies!

Await your kind guidance!

Thanks & Regards

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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06 May 2025 Need to check your status as NRI every year before filing ITR. If NRI, you don't need to declare Income earned in Australia; otherwise the trend as stated above needs to be changed.

RAJEEV KUMAR MEHTA

RAJEEV KUMAR MEHTA (Querist)
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06 May 2025 Sir
Thank You for your kind advice. So if NRI status remains, the assessee may file Income earned in Australia and India with respective tax authorities. Right? Does that comply with DTAA requirement?

Kindly advise!

Thanks & Regards

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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06 May 2025 Yes. The core purpose of DTAA is, it ensures that income earned in one country by a resident of another is taxed in only one of the two countries, preventing the same income from being taxed twice. This is especially beneficial for multinational corporations and individuals working across borders. Being resident of Australia, you need to check whether you have to declare income earned in India with Tax authority in Australia (& claim rebate of any tax paid in India) or not?

RAJEEV KUMAR MEHTA

RAJEEV KUMAR MEHTA (Querist)
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06 May 2025 Thank You Sir! It has been a great help!

Thanks & Regards

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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06 May 2025 You are welcome.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 September 2025 Good luck.....

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