U.A.E. Income

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Querist : Anonymous

Querist : Anonymous (Querist)

13 July 2010 My husband has a resident visa of Dubai. He has his own business there. He earns commission income there(recieves it there & keeps it there).He is an Indian resident as per IT Act. His company/business is under the tax free zone there. He has his company set up in India too, but it is not linked to the U.A.E.business.
My query is:
Whether U.A.E.income will be taxable in India, because there is some DTAA between U.A.E. & India?
But the income there is tax free, so what should be done?

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)

13 July 2010 First confirm whether it is a company or business as there will be difference in the taxability of both entities.

Querist : Anonymous

Querist : Anonymous (Querist)

13 July 2010 It is a sole proprietership company there. Its called FZE(free zone enterprise)

Querist : Anonymous

Querist : Anonymous (Querist)

14 July 2010 Can someone plz help?

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)

14 July 2010 How can you say that he is a resident in India. I mean please tell for how many days he was in India??

Querist : Anonymous

Querist : Anonymous (Querist)

15 July 2010 He was here for the pre-requisite days reqd by the IT Act. So he is a resident & ordinarily resident as per the IT ACt. Can u tell me whether his Dubai income is taxable here even after that esp when he receives it & keeps it there?

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)

15 July 2010 As per Section 5 of Income Tax Act, 1961 if he is a resident and ordinary resident then his all incomes earned anywhere in the world will be taxable in India. However if there is any DTAA between India and that country then relief can be provided for the tax paid in other country.

Querist : Anonymous

Querist : Anonymous (Querist)

15 July 2010 So eventhough he earns it there, receives it there & keeps it there, he needs to pay tax here???

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)

15 July 2010 yes, if he is a resident and ordinary resident all incomes will be taxable in India.

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