Latest Expert Exchange Queries

Make your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: cpt :: TAX RATES - GOODS TAXABLE @ 4% :: articles on VAT and GST in India :: form 3cd :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: TDS :: due date for vat payment :: empanelment :: ACCOUNTING STANDARD :: list of goods taxed at 4% :: VAT Audit :: VAT RATES
 
 
« General »
 Non-performance: I-T dept transfers 245 commissioners
 Income Tax efiling: Tax implications resulting from clubbing of income
 Guidelines for selection of cases for scrutiny during the financial-year 2017-2018-regd
  GST: How companies are gaming the system
 Goods And Services Tax transparency: Elimination of added taxes to boost investment in realty
 In a first, Income Tax department to charge govt official under new benami law
 Income Tax Return Filing: 10 common mistakes people make while filing return of income
 Income Tax efiling: A few essential facts for senior citizens to keep in mind
 Pre-GST discounts get Maharashtra 16% more sales tax in three months
 Here’s how self-employed should efile their taxes
 Advance tax given by individuals in June quarter rises more than 40%

Do you need to pay tax in India for salary recieved abroad?
March, 01st 2014

Arnav Pandya

There is often an element of confusion about the manner in which salary income has to be considered for tax purposes by an employee. Often the services for the salary is rendered in some other country across the world and the question that arises is then whether this would be taxable and where it would be taxable. There are several conditions that are present in the Income Tax Act which clarify the exact details of when and how the taxation for the salary will be undertaken especially when received abroad and hence it is important to look at these and then come to a final decision. Here are some variations that will be witnessed and the impact of this on the taxable income of the individual.

Overall basis
There are some incomes that are deemed to arise in India even if they are received abroad so these have a very important role in their classification. It is important that the conditions related to the salary is considered carefully because this will be applicable to all people whether they are a resident or a non resident for the purpose of taxation. There are different ways in which this will be taxed but the overall base is that if some conditions are fulfilled then the salary would be taxable in India.

Service rendered in India
In case there is income received abroad by an individual as salary and the service is rendered in India then the amount would be considered for taxation in India. The key point here is that the service has to be rendered in India. Once this is fulfilled then it does not matter as to whether the company is Indian or not and other related points. The service has to be in India if the income is to be taxed here and this would be the main factor that has to be considered when the amount is received abroad.

Service rendered outside India
Just because the income from service rendered in India is taxable in the country it is not necessary that the reverse would be true in all cases. There is a difference in the manner in which the salary and the various perquisites and allowances are taxed in some cases so these have to be separated when necessary. However a condition where there is service that is rendered outside India and the employer is the government of India and the employee is a citizen of India then the income received outside India would still be considered as having arisen in India and taxed in the country. Several conditions are important here with the first being that this classification is for salary received and not other heads like allowances under the head of salaries. The next condition is that the employer has to be just the government of the country and the person needs to be an Indian citizen if the condition of the citizenship is not met then once again the income would not be considered to have been arisen in India.

Other cases
There are other cases too where the service is rendered outside India and in this case the employer could be any other entity other than the government of India. In such a case the salary income would not be considered to have arisen in India. This is a clear distinction that arises due to the fact that the employer is not the government and the services are rendered outside India. In this case even if the person is an Indian citizen then the overall conditions would be applicable and hence there would not be any income that arises in the country. Once the basic distinction is made then the additional way of taxation of the income arises and this would then have to be followed.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
E-catalogue online catalogue E-brochure online brochure online product catalogue online product catalogue e-catalogue Indi

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions