term “liable to tax” has now been expressly defined to include income tax liability with reference to that country and shall include a person who has subsequently been exempted from such liability under the law of that country.
The changed definition now offers more clarity. Those who are not liable to tax in any foreign jurisdiction (including jurisdictions having no personal tax law) shall continue to be governed by this deeming residency provision.
In other words, Indian citizens living in countries where there is no personal income tax, for example, UAE, will be considered to be deemed residents in India even though they may not be physically present in India for a single day in the relevant financial year (FY).
does this mean nri who working in gulf have now to pay tax in india on their income earned in gulf ???
CAclubindia
