Understand The Tax Residency and Income Tax implication on Person Living in UAE

The Finance Bill, 2020 contains a provision that deems an Indian citizen to be a resident in India if they are not liable to be taxed in any country or jurisdiction. This provision is aimed at preventing the abuse of tax laws by Indian citizens who move to low or no tax jurisdictions to avoid …

Payment to a UAE service provider for design services was non-taxable under the India-UAE DTAA as no FTS clause and no PE of the service provider in India.

The Ahmedabad Income Tax Appellate Tribunal (ITAT) recently issued a ruling in a case involving an Indian company, Kalpataru Power Transmission Ltd., and a UAE-based service provider, Oilstone UAE. The case centered on whether payments made by the Indian company to the UAE service provider for design services were subject to Indian taxation. The ITAT …

Foreign Tax Credit Cannot be Disallowed on Account of Delay in Filing Form 67

The Income Tax Act allows residents of India to deduct the income tax paid in the United States from their tax liability, as per the provisions of the Double Taxation Avoidance Agreement (DTAA) between India and the United States. Rule 128(9) of the Rules, which does not provide for the disallowance of Foreign Tax Credit …

No TDS on Payment to Irish Company Facebook not Having Permanent Establishment for Advertisement Services

During the year, an assessee paid Rs. 67,68,768/- to an Irish company for advertisement services without deducting tax at source. The Assessing Officer disallowed the payment under section 40(a)(i) for non-deduction of tax at source. However, the Commissioner (Appeals) observed that the Irish company had certified that it did not have a Permanent Establishment (PE) …

Top Mistakes to Avoid as a Non-Resident Indian (NRI) During Tax Return Filing

As a Non-Resident Indian (NRI), filing income tax returns in India can be a complex and daunting task. It is important to avoid common mistakes that can lead to unnecessary penalties and legal issues. Here are some of the top mistakes that Non-Resident Indian (NRI) should avoid while filing their income tax returns. We welcome …

Once Assessee is a Non-Resident, Income or Deposit in Foreign Bank Account Cannot be Taxed in India

The Mumbai ITAT has allowed an individual Assessee’s appeal and held that a mere mention of the residential status as a resident in the original return of income cannot be the sole ground for treating the Assessee as a resident. The Assessee had declared his residential status as non-resident in the income tax return for …

What is Tax Treaty, How It Works, and What Tax Treaty benefits available to Non-Resident Indians (NRIs)

Tax treaties are agreements between two countries to avoid double taxation of individuals or companies that may have tax obligations in both countries. Non-Resident Indians (NRI) can benefit from tax treaties in several ways. In this response, We will explain what a tax treaty is, how it works, and the various tax treaty benefits available …

What is Tax Treaty and How Treaty Benefits To Non-Resident Indians (NRIs)

A tax treaty, also known as a double tax treaty or a tax agreement, is a bilateral agreement between two countries that aims to prevent double taxation of income earned by residents of one country in the other country. It establishes the rules for taxing different types of income, such as wages, dividends, and capital …

Are You a Salaried Employee with Foreign Income and Have Received an Income Tax Notice?Don’t Hesitate to seek assistance of a professional CA

As a salaried individual who has foreign income, receiving an income tax notice can be a daunting experience. However, it’s essential to understand that foreign income is subject to taxation in your home country, just like your domestic income. If you’ve received an income tax notice for your foreign income, the first step is not …

No Equalisation Levy on Google Adwords Since Person Running, Displaying and Using Advertisement are Outside India

The ITAT in Jaipur recently dismissed the Revenue’s appeal and held that the Assessee, an individual service provider of online advertisement, digital marketing and web design for consultancy charges, was not liable for disallowance under Section 40(a)(ib) of the Income Tax Act, 1961. The Assessee was initially subjected to disallowance of Rs. 8.89 Crore for …

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