Double taxation avoidance

Hi

Taxes will be calculated in India while filing ITR. You shall be able to claim credit of taxes paid in Oman. That is called Foreign tax credit.

You will have to file form 67 before filing of income tax return.

Dear Sir,

Hope you are doing well !!

You can claim the credit of taxes paid in Oman while filing ITR in India.

As per the tax laws of India, sections 90 and 91 of the Income-tax Act deal with the concept of FTC. Section 90 discusses claiming of FTC in a case where India has entered into a Double Taxation Avoidance Agreement (DTAA) with another country.

Under these sections, if the taxpayer is a resident of India, and he has paid taxes outside India, he can claim a credit of such foreign taxes paid against his tax payable in India.

In accordance with Rule 128, in order to claim FTC, the taxpayer is required to file following documents on or before due date of filing of return:

1. A statement of :

• foreign income offered to tax
• foreign tax deducted or paid on such income in Form No. 67

2. Certificate or statement specifying the nature of income and the amount of tax deducted therefrom or paid by the taxpayer :

• From the tax authority of the foreign country
• from the person responsible for the deduction of such tax
• signed by the taxpayer

3. Proof of payment of taxes outside India

We may assist you in entire procedure.

You must give TRC from India to Oman company and tell them that your income will be taxable in India and they should not deduct tax as you are resident of India.

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

Thank you

Hello Sir,

Section 90 of the Act allows taxpayers to claim credit of foreign taxes paid in overseas countries as per the provisions of the tax treaties entered by India with such other country. A taxpayer can choose to be governed either by provisions of the tax treaty or by the domestic tax law to the extent more beneficial to him. As per details available on income tax website, till date, India has entered into tax treaties with 98 countries. However, in case where no tax treaty exists between India and other foreign jurisdiction, Section 91 allows for unilateral relief in India for taxes paid in such foreign jurisdiction.

Under the tax credit method, the resident country retains the right to tax the foreign income and allows credit for the taxes paid in source country. The resident country would determine the resident’s worldwide income (including foreign sourced income) and compute the tax liability thereon. From the tax liability so computed, credit is granted, subject to certain limits, of the foreign taxes paid on such foreign sourced income.

You need to submit the form 67 for claiming the FTC.

Hello,

You can produce the Tax Residency Certificate (TRC) to the foreign company.

Your income earned in Oman will be taxable in India and you can claim credit of foreign tax on the same income. 

I hope that this answer satisfies your requirement.

Regards,

CA Hunny Badlani

- Collect WHT certificates from Oman.

- File form 67 before filing of ITR.

- File ITR and relevant schedules of foreign income and foreign credit.