In the new IT returns , there is a section to add details of foreign retirement accounts.
Say, in case person was NRI till FY 16 with retirement corpus of 10 L and become resident from then
From FY 17 to FY 21, corpus increased to 15L and in FY 22 it increased to 16 L ?
Exactly what amount is to be added in
In
Is it 6 (16-10) or cumulative income or 1 (just income in FY 22)
Income in FY 2021-22, which is 1 lakh in your case...
While this seems logical in other years where one is deferring.
Problem is that it does not seem logical to have 1 for the year of withdrawal as the income has to tally with tax paid,
and the tax calculation in return has to tally. Tax is on on cumulative income and Suppose one is withdrawing in FY 2021-22, the tax is to be paid on 6 lakhs.
Hi Sgpension,
Form 10 EE has a column "Balance as on last day of the financial year prior to the previous year for which this Form is being filled (v)". I think, this should be the value as on March 31, 2021. In your example, it will be 15L.
So, the income accrual of 1L is most likely the amount that needs to be reported. Form 10 EE has to be filed before ITR2. So the ground is already established regarding the balance at the end of FY 2020-21.
BTW, was the 1L accrual or withdrawal? If it is just accrual, tax need not be paid now, isn't it?
1L is just accrual , no tax is to be paid. Form 10-EE has a seperate set of information but it gets filed only once. I think form 10-EE is not supposed to be filed for future years so not sure how details of income would be available in IT return during year of withdrawal . Tax needs to be calculated in return.
However, I am just confused as to how this should work given the nature of tax (deferral and cumulative).
If we assume that just the annual amount is shown in years when no withdrawal. (1 L in this case)
while cumulative amount is shown in withdrawal year in the ITR, only then would the tax calculation be correct.
This is however not consistent across years, hence the confusion.
Better approach would be if the amount is filled only during withdrawal year but IT department would usually want people to report this accrual
I hope some clarification comes from department but unfortunately form 10-EE is not even live on portal and return is to be filed in 20 days.
CAclubindia
