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Non-Resident + Interest below Taxable Limit => Is ROI needed

Mohit (None) (24 Points)

07 August 2010

I have a bank account in India for which the interest income is below 30000Rs. I am a non-resident of India for Tax Purposes as I have been working outside India for couple of years.

In this situation, my only income in India is 30000 Rs. Unfortunately the bank is not deducting the TDS on the intreset income - I called them and they don't know why it is not getting deducted automatically.

Could someone please tell me, Do I need to file a ROI in this case? What happens If I file an ROI and the TDS is not deducted from the bank. Will I be considered at fault for this?

Thanks,

Sukesh

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4 Replies

CA Amit Kumar Khaitan (Research Analyst) (360 Points)
Replied 07 August 2010

No Mr. Suresh, deducting TDS is always the responsibility of deductor. You can not b considered at fault at all.

Also, the bank should normally deduct the TDS.

As you do not have taxable income in India, you need not pay any tax or file a return, but its always good to file a return even if no tax is payable

Sukesh (None) (21 Points)
Replied 08 August 2010

Thanks for the reply.

I had the account since 2006. How far back can I go and file the returns?

If I file the 'late' or 'belated' returns, will I come under scrutiny?

If I come under scrutiny, do I have to be present in India to answer their questions?

Since I don't owe any taxes, Can I still end up paying penalty, If I file my previous ROIs?

Thanks,

Sukesh

adisri (Final ) (610 Points)
Replied 08 August 2010

As far sa iam concern , you r a non-resident you non-resident income is not liable for tax in India. Interest received by you form the bank towards the interest is below the taxable limit for the Asst.Year 2010-11 and you are not liable to pay tax . For the previous years if your bank interest exceeds the taxble limit of that years then you are laible to pay tax on that income .

CA Amit Kumar Khaitan (Research Analyst) (360 Points)
Replied 08 August 2010

If you come under scrutiny, you can always hire a representative in India (eg. a CA).

You are not legally required to file a return if your Total Income taxable under the IT Act is not in excess of the maximum exemption limit. (if the interest income is your only income taxable in India and I assume that its not exceeding even Rs. 1 lac in any year)

If you file your return it does have chances of getting into scrutiny but it has not much to deal with there being belated returns.

At present, you can file a belated return for F.Y 08-09 and 09-10.

If you have no other income there is no legal way that you can be levied with a penalty. You will infact be voluntarily filing your return in a case where there is no obligation, rather an option.

I would suggest that if you want to file, only file the return for FY 09-10 ie for AY 2010-11