Nri income transferred to india

232 views 8 replies

Shalin

Business

31 Points Joined October 2014

Hello All,

I am an NRI having IT/Software business in Dubai. I need your expert advise on the below points;

(1) Can I transfer my profits of Dubai business (Sole Proprietorship) to my NRE/NRO Bank accounts in India? Will there be any income tax implications on it? What I know is that any NRI can transfer his foreign earnings to his bank accounts in India and on which there will not be any income tax levies.

(2) The profits which I transferred per point 1 above, can I distribute them to my family members (blood relatives) in India. For which I'll prepare Gift Deeds and will get them notarised. Will there be any income tax levies on these gift distributions? What I know is that if anyone distributes any money (any amount) to his blood relatives then there will not be any income tax levies on these distributions.

Kindly requesting you to clear my above doubts.

Your prompt replies will highly be appreciated.

Thanking you all in advance.

Replies (8)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

197601 Points Joined July 2016

You are correct (in both case), but proper evidences are required to be produced in case of query.

Shalin

Business

31 Points Joined October 2014

Thanks sir for your reply. I have all the documents for the source of my Dubai business income (MOUs, Invoices, Bank Statements with my Customers & Suppliers). Also I'll prepare Gift Deeds in India and get them notarised. Please suggest me if I am missing something above.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

197601 Points Joined July 2016

As such none other as long as you are NRI for India, Have business records with VAT paid in Emirates, Bank transfer of your income in India, and the Gift Deed.

Shalin

Business

31 Points Joined October 2014

Sir, I believe NRI means any person who stays outside India for 183 Days or more, Right? Is there anything else I am missing in this definition of NRI?

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

197601 Points Joined July 2016

One more condition is there with 60 days stay in India, check it on Google.

Shalin

Business

31 Points Joined October 2014

I found the below two conditions and it's written any one should be fulfilled;

You are considered an Indian resident for a financial year:

i. When you are in India for at least 6 months (182 days to be exact) during the financial year

ii. You are in India for 2 months (60 days) for the year in the previous year and have lived for one whole year (365 days) in the last four years

If you are an Indian citizen working abroad or a member of a crew on an Indian ship, only the first condition is available to you – which means you are a resident when you spend at least 182 days in India. The same is applicable to a Person of Indian Origin (PIO) who is on a visit to India. The second condition is not applicable to these individuals. A PIO is a person whose parents, or any of his grandparents were born in undivided India.

Kindly advise if the above is correct and in order to be an NRI any one of the above conditions should be met.

Shalin

Business

31 Points Joined October 2014

Also found the below reference wherein it's stated that only the 1st condition is required to be met;

The residential status of a person in India depends on his period of stay in India. The period of stay is counted in number of days for each financial year beginning from 1st April to 31st March (known as previous year under the Income-tax Act, 1961). It is pertinent to note that the day of departure from India and the day of arrival in India shall also be considered as a day of stay in India. The definition is explained in simple terms as under.

NON-RESIDENT

If an individual who satisfies understated both the conditions of section 6 of the Income-tax Act, 1961 (the “Act”) then he shall be considered as a Non-Resident as per the Act.

Condition		Status
1.	He is not in India for 182 days or more during the relevant previous year.	If yes, then he is a non-resident. (subject to condition "2")
2.	He is not in India for 60 days or more during the previous year and he is not in India for 365 days or more during the 4 years prior to the previous year.	If yes, then he is a non-resident. (subject to the exceptions mentioned below)

Exceptions:
• If an individual being a citizen of India or a person of Indian origin comes on visit to India during the year or
• If an individual being a citizen of India leaves India during the year as a member of the crew of an Indian ship for the purpose of employment or
• If an individual being a citizen of India leaves India during the year for employment outside India.

In other words, the above categorized individuals are non-resident if they satisfy condition “1” alone.