TAX CONSEQUENCES

This discussion explores the tax complications of receiving payment for management services from a foreign country into India. While initially suggested as foreign income with Double Taxation Avoidance Agreement (DTAA) relief under Section 90, a key point raised is that such income might not be considered foreign income at all. The applicability of DTAA and the calculation of relief, which is the lower of Indian or foreign tax rates, are also discussed, with an emphasis on the need to specify the country involved.