• Residential status for income tax

I have worked for 185 days in Singapore, and the rest in India for current financial year. Do I need to pay tax on Singapore salary in India?
My confusion is due to a rule mentioning that if i return in same financial year, then i need to pay tax in India if i was in India for at least 62 days. But there is also a rule saying that this 62 is replaced by 182 if i am employed in foreign country or am on ship. Source: https://www.google.com/amp/s/m.economictimes.com/nri/nri-tax/are-you-earning-abroad-know-the-tax-rules/amp_slideshow/59860408.cms

so. Do i need to pay tax in India for Singapore salary? If so, then is there anything i can do to legally avoid this?
Asked 3 years ago in Income Tax

Hi,

 

Hope you are doing well !!

 

A taxpayer would qualify as a resident of India if he satisfies one of the following 2 conditions :

 

1. Stay in India for a year is 182 days or more or

 

2. Stay in India for the immediately 4 preceding years is 365 days or more and 60 days or more in the relevant financial year.

 

In the event an individual leaves India for employment during an FY, he will qualify as a resident of India only if he stays in India for 182 days or more. This otherwise means, condition (b) above of 60 days would not apply to him.

 

If you went for employment during an FY, you will be treated as NRI and your tax liability in India is restricted to the income you earn in India. You need not pay any tax in India on their foreign income.

 

Thanks & Regards,

Payal Chhajed

Payal Chhajed
CA, Mumbai
5132 Answers
191 Consultations

5.0 on 5.0

- Employment contract.

- Employment visa (by whatever name called. The visa should permit the person to work.)

- Bank statements/Regular deposit of salary in bank account.

- Salary certificate.

- Income-tax returns in the country of employment showing salary income.

 

The above is a guide. It does not mean that all the above should be there. Essentially one has to establish the fact that he had gone for employment.

Payal Chhajed
CA, Mumbai
5132 Answers
191 Consultations

5.0 on 5.0

Hi

your tax status would be Resident and you should pay tax on only what you earned in India.

Rajkumar Wagh
CA, Kolhapur
45 Answers

Not rated

Under section 6(1), an Individual is said to be Resident in India in any previous year, if he satisfies any one of the following conditions:

 

-(i) He has been in India during the previous year for a total period of 182  days or more, or

-(ii) He has been in India during the 4 years immediately preceding the  previous year for a total period of 365 days or more and has been in  India for at least 60 days in the previous year


If the Individual satisfies ANY ONE of the conditions  mentioned above, he is a Resident. If both the above  conditions are not satisfied, the Individual is a non-resident

 

There are 2 exceptions to the above rule of classification of Residential Status:-

1. In case of an individual, who is a citizen of India and who leaves India in any financial year for the purpose of employment outside India OR who leaves India during the previous year as a  member of the crew of an Indian ship, the 2 nd condition stated above shall not be applicable and only the 1st condition of 182 days or more would be applicable

2. In case of individual who is citizen of India or person of Indian Origin outside India comes on a visit to India in any financial year, the 2 nd conditions stated above shall not be applicable and only the 1st condition of 182 days or more would be applicable.

 

If you are following the condition of exception then condition (i) of Section 6 shall only be applicable for determining the residency. You have spent 180 days in India, accordingly you are not a resident in India and your Salary earned in Singapore not taxable in India.

 

You need to Maintain proper documentation that you left India during the previous year for foreign employment or as a  member of the crew of an Indian ship. Please note that when an employee working in India goes abroad for a few days, he cannot be said to have an ‘employment outside India’ – ITO vs. Abbott Laboratories Ltd. (31 ITD 183). There has to be a proper employment.

 

Ajit Kumar Jain

Founder- NRI MiTRA

Ajit Kumar Jain
CA, Mumbai
26 Answers

5.0 on 5.0

Hi

A taxpayer would qualify as a resident of India if he satisfies one of the following 2 conditions :

1. Stay in India for a year is 182 days or more or

2. Stay in India for the immediately 4 preceding years is 365 days or more and 60 days or more in the relevant financial year

In the event an individual leaves India for employment during an FY, he will qualify as a resident of India only if he stays in India for 182 days or more. This otherwise means, condition (b) above of 60 days would not apply to him.

 

Since only condition 1 applies to you, you will be a NRI in India for the relevant FY. You need not report the Income from Singapore in ITR filing in India.

I assume you have moved out of India this FY and not otherwise.

Lakshita Bhandari
CA, Mumbai
5572 Answers
661 Consultations

5.0 on 5.0

You don't need to submit any proofs while filing the ITR in India. Proofs shall be required only when there is a query from the IT department. Proofs shall include your Singapore employment related papers and passport copies for calculating period of stay in India.

Lakshita Bhandari
CA, Mumbai
5572 Answers
661 Consultations

5.0 on 5.0

HI

Your residential status will be NRI so you need not to pay any taxes in India for Singapore salary. Only Income earned in india will be taxed .

Swati Agrawal
CA, Mumbai
1146 Answers
7 Consultations

5.0 on 5.0

HI

No proof required while ITR.

You have to keep documents like Employment related documents you received in singapore and passport  copy ,Income tax return copies of Singapore,Bank Statement .


No proof required while  filling ITR.

You have to keep documents like Employment related documents you received in singapore and passport  copy ,Income tax return copies of Singapore,Bank Statement .

 

Swati Agrawal
CA, Mumbai
1146 Answers
7 Consultations

5.0 on 5.0

Hi,

- You are NRI in India and not required to file ITR in India if you do not have any other taxable income in India. Condition of 60 days does not applied to you.

Vivek Kumar Arora
CA, Delhi
4243 Answers
408 Consultations

5.0 on 5.0

Yes you are correct since you have left for employment you can claim that you are not an Indian resident anymore for the purpose of income tax and therefore only the income earned during the year in India will be taxed in India.

You just need to select non resident in the return of income as of now and provide the details which are required in the return of income other than that right now you don't need to give any proof if and when asked you just need to submit you appointment letter for Singapore job and your passport copy to prove you were in India for less than 182 days and that you are in Singapore for employment purpose.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Naman Maloo
CA, Jaipur
3893 Answers
52 Consultations

5.0 on 5.0

Hi,

 

You are not required to file ITR in India as you are NRI for current financial year. (Assuming you are not having any other income in India).

 

 

Karishma Chhajer
CA, Jodhpur
2439 Answers
27 Consultations

5.0 on 5.0

Proofs are only required for future.

 

You do not need to submit any proofs for ITR purpose in India.

Karishma Chhajer
CA, Jodhpur
2439 Answers
27 Consultations

5.0 on 5.0

A taxpayer would qualify as a resident of India if he satisfies one of the following 2 conditions :

 

  1. Stay in India for a year is 182 days or more or
  2. Stay in India for the immediately 4 preceding years is 365 days or more and60 days or more in the relevant financial year

In the event an individual leaves India for employment during an FY, he will qualify as a resident of India only if he stays in India for 182 days or more. This otherwise means, condition (b) above of 60 days would not apply to him.

 

Had you returned in the succeeding year, you would have been governed by 182 days provision without any doubt.  Since, you have returned in the same year, the tax officer can deny the 182 provision.  However, technically you need not pay taxes again on the Singapore income.  There are tax provisions on income earned from abroad and taxes paid which can be claimed in INDia. 

While is there no detailed list given by CBDT, documents which provides for employment and stay outside India should be maintained.  I hope your income was credited in Singapore bank account. No documents are required for filing return, it is only if enquiry is initiated, you should furnish your documents.  Some important documents – passport, foreign work permit, pay slips, letter from employer for deputation abroad etc.

Jasmina Jain Shah
CA, Greater Mumbai
447 Answers
4 Consultations

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