Hi
You can show these as loans. Make a future arrangement so as to receive these funds in your salary account in Qatar and you pay back this money to the company from Indian accounts. This is the only way to save taxes.
NEFT transfer
Morning,
I am working at qatar for past 18 months and due to to sudden crisis in qatar by the neighbouring countries, my company ( they also have business in india) dis not pay me for 4 months.Due to my pressure, i told them to settle at india atleast and i gave them the indian savings bank accounts .The owner finally NEFT transferred (from his account )my 4 months salary of 20 lacs total INR to my indian account(5 lac INR ), also to my wife ( 5lac INR)and father in law (5 lac INR) accounts and my brother accounts(5 lacs- he regularly files IT). My wife is not working( no IT filing in the past ) but my father in law is running a small business, though he has not files IT in the past. Kindly tell me how to overcome this issue without any problems and without paying any taxes, as after all its my hard earned money at abroad. My friend advised me that i can produce a salary certificate from qatar and need not pay tax, others telling me that my wife and father in law money can be shown as a loan from a person who deposited. I also have a pending home loan in SBI for 22 lacs INR( initial loan was 42 lacs, i repaid 16 lacs over tha past 18 months )Asked 7 years ago in Income Tax
Hi,
You have two options:
1. Follow your friend's advice and show it as a loan received by your wife, father-in-law and brother. This will continue to appear in their books forever.
OR
2. Show it as income in their hands and pay tax accordingly. Tax will be payable by them as per the slab rates.
Regards,
Keerthiga Padmanabhan
M.Com., CA, LL.B
Hello,
1. Option 1 show it as loan for now and reverse it at any future point of time.
2. Pay tax now and close the chapter once and for all.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, FCA, LLB, CERT. FAFP
thanks for the valuable response. can i just tell my wife and father in law to show that as income and pay within 2.5 lac to 5 lac slab (i.e 5% slab)? If so, when should i ask them to file the IT return? can i do it before march 31,2018? will i get any notice from IT dept before march 31, 2018? pls clarify
Asked 7 years ago
Hi,
You have following options:
1. All the four members will have to show it as a loan. Loan will be repaid in future and you will receive salary in your Qatar bank account from your original employer.
2. Showing it as salary for your wife and father in law. In that case, the person paying the salary will have to deduct TDS and deposit it to the government. Otherwise, question can be raised.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
The salary earned by you outside India is income accruing or arising out of India and you will not be required to offer such income, if you are a Non-Resident during the years such salary income accrued to you. Now the arrears of salary paid to you in India is in respect of the salary due to you and not for any other reason. Hence, the amount received by you is not assessable to tax, as the employer is only discharging his liability to pay salary in Qatar.
However, when the employer pays the arrears of such salary to your wife, father in law and brothers, the nexus between the arrears of salary due to you and the payment to them has to be established with sufficient documentary evidences. If you are able to establish such nexus, then such receipt in their hands will not be taxable.
The issue will then be to determine the nature of transaction between you and your wife/father in law/brothers. If they have received the amount on your behalf and later transferred the amounts to you, then there is no issue, as this was the return of money received by them on your behalf . If there is no such repayment, then it could be gift or loan to them by you. If it is a gift, then such gift is an exempt income in their hands u/s 56. If it is a loan, then they may be violating 269S, as they have not received the loan from you directly. However, you should be able to justify the need for routing the payments through them.
The due date for the filing of your return is 31st July 2018.
This can be done. But this makes the case doubtful. If you do this, make sure property TDS deductions have been made and accordingly returns are filled. Returns will be filed after March 18. This would be in June- July 18.
again thanks for the responses. 1 final question...sorry if it looks amateurish.. From Dec2016 to nov. 2017, i have nearly transferred Rs.40 lacs INR to my NRI account at India. Is it possible to give explanation that i gave 20 lacs INR as a debt/loan to my friend's father ( in this case, i am addressing my boss as my friend's father) in India in cash and he returned back the money to my account and my relatives account as instructed by me. Just any paper signed by both of us , with seal and date , is enough to prove a loan given by me to him is sufficient?After all, he is my friends father. kindly throw some light pls
Asked 7 years ago
Declarations signed by both would constitute valid proofs. But how will you prove payment of 20 lakhs to your friend's father?
Giving loan in cash is prohibited in India. Accordingly, you can't give this explanation.
Hello,
1. You cannot file the return before 31st March 2017 as the year ends on 31st March 2017. You can pay the taxes now and keep in case you want to.
2. You cannot show a cash loan for more than Rs.20,000/- as per the Income Tax Rules. In case you give a loan for more than 20,000/- and show it in your return you are liable for penal action.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, FCA, LLB, CERT. FAFP
Transfer of your money from one account to another account is not taxable. As the salary earned by you outside India is not taxable, there is no need to show this as loan from your employer, even if he is your relative/father of your friend. However, if there is no employer and employee relationship between you and the payment is not for this purpose you may land up in tax litigations if you try to camouflage the real nature of transactions.
Hi,
Your wife and father-in-law can file their tax returns after the end of the financial year i.e. after 31 March 2018. They can file it till 31 July 2018.
Regards,
Keerthiga Padmanabhan
M.Com., CA, LL.B
Also, you cannot say that you have given loan in case to your boss / friend's father. Giving loan in cash above Rs. 20,000 is a violation of section 269SS of the Income-tax Act and will lead to penalty.
Regards,
Keerthiga Padmanabhan
M.Com., CA, LL.B
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