• NRI - Taxation /TRC requirement

Currently I am an RNOR until 31st March 2021.FY 21-22 I will be an NRI who will spend more than 183 days overseas with a proper visa at UAE.

My income from overseas will be sent to my NRI Account in India in 21-22
My stock investments that I have done in the past will surely yield me some returns too/FD interest in India.

My questions are the below :

1.)Will my overseas remittance be taxed if I do not produce a TRC (Tax Residency Certificate) from UAE?
2.)Is it "mandatory" for an NRI to have a TRC when I file taxes failing which my NRI account will be taxed too?
3.)Will my Indian income be treated separately as per the regular tax slabs?

Kindly clarify.
Asked 19 days ago in Income Tax

In your case condition of 120 days and 365 days for four years is applicable. If you will be less than 120 days in India then you will be an NRI otherwise calculate the no.of days for each year separately. Condition of 120 days is applicable from A.Y.2021-22. For detailed discussion, please take phone consultation.

1) No

2) No

3) Yes

Only Indian Income will be taxable in India. Amendments made in Finance Act 2020 has been put to rest.

Vivek Kumar Arora
CA, Delhi
3986 Answers
312 Consultations

5.0 on 5.0

Hi

 

1. Since you would be NRI, only Indian sourced income would be taxable in India.

2. No.

3. Yes, you need to pay taxes on indian income as per normal slabs.

Lakshita Bhandari
CA, Mumbai
5403 Answers
487 Consultations

5.0 on 5.0

Dear Sir,

 

Hope you are doing well !!

 

1.You will be required to pay taxes only on income earned in India.

 

2.No.

 

3. Yes, you need to pay the taxes on Indian income as per applicable slab rate.

Payal Chhajed
CA, Mumbai
5039 Answers
137 Consultations

5.0 on 5.0

1) TRC will be required to claim tax relief for tax deducted in foreign country.

2) Yes, Indian income will be taxed separately.

Ruchi Goel Anchal
CA, Gurgaon
432 Answers
4 Consultations

5.0 on 5.0

TRC requirement is there if you wish to take benefit of DTAA but if you are outside India and hence not resident in India there is no need for TRC.

Being non resident only your income in India would be taxed.

We can discuss about taxability of income from various sources over phone.

 

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement. You can even book phone consultation for further personal assistance.

Thank you.

Naman Maloo
CA, Jaipur
3766 Answers
44 Consultations

5.0 on 5.0

There were two amendments as follows:

1) In second basic condition for being resident, previously law was 365 days in four previous years preceding previous year and 182 days in a previous year. It was reduced to 120 days.

2) An individual, being a citizen of India, having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year shall be deemed to be resident in India in that previous year, if he is not liable to tax in any other country or territory by reason of his domicile or residence or any other criteria of similar nature.

 

Relaxation is given by keeping the status of above individuals as RNOR if he stays more than 120 days but less than 182 days in a previous year. 

 

Please take phone consultation for detailed discussion.

 

 

Vivek Kumar Arora
CA, Delhi
3986 Answers
312 Consultations

5.0 on 5.0

Please note that Section 6(6) provides that in the above scenario, you will be a resident but not ordinarily resident and a not ordinary resident is not required to pay tax on foreign sources income.

 

The relevant section has been reproduced below and relevant portion is highlighted in bold.

 

(6) A person is said to be "not ordinarily resident" in India in any previous year if such person is—

 

(a) an individual who has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine days or less; or

 

(b) a Hindu undivided family whose manager has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine days or less 7[; or

 

(c) a citizen of India, or a person of Indian origin, having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year, as referred to in clause (b) of Explanation 1 to clause (1), who has been in India for a period or periods amounting in all to one hundred and twenty days or more but less than one hundred and eighty-two days; or

 

(d) a citizen of India who is deemed to be resident in India under clause (1A).

 

Explanation.—For the purposes of this section, the expression "income from foreign sources" means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India) 7a[and which is not deemed to accrue or arise in India]].

Lakshita Bhandari
CA, Mumbai
5403 Answers
487 Consultations

5.0 on 5.0

No you would be treated as resident but not ordinary resident as per the details provided.

Naman Maloo
CA, Jaipur
3766 Answers
44 Consultations

5.0 on 5.0

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