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I am planning to return to India after working in the UK for 10 years, and will be getting some retirement benefits. Will this money be taxed?

—Rajesh Mittal

You need to first establish your residential status. Non-resident Indians (NRIs) and resident but not ordinarily residents (RNORs) are only taxed on income earned, accrued or received in India. Residents must pay tax on their global income. In case you are an NRI, you will not be taxed for retirement benefits from outside India. In case you are a resident, you will likely be taxed in India as well. But you will be allowed to claim tax relief as per the double taxation avoidance agreement.

My parents have gifted me 10 lakh, which is in my Indian bank. I stay in the UAE. What will be the charges, and is there a limit on the amount that I can transfer to the UAE? What will be my tax liability?

—Rayaan

Gifts received from parents are tax-exempt. An NRI is allowed to transfer $1 million in a financial year from their non-resident ordinary (NRO) accounts. Your bank may require some documents before remitting the money. These forms are Form 15CA (a self-declaration) and Form 15CB (certificate from a chartered accountant). Certain nature of remittances do not require these forms to be submitted, but note that bank may insist on them to make sure tax has been duly paid on the remittance being made.

I am joining a Saudi Arabia-based company, but will work from India only. I will be receiving salary in my Indian account in riyal. Will I be taxed in India? Will my income in India be counted as “salary", and if not, then under which head will it fall?

—Name withheld on request

To find out how your income will be taxed, you must identify your residential status for that year. Assuming that you will continue to be resident in India and don’t travel abroad in this financial year, you are likely to be a resident for tax purposes. Also, income earned or received in India shall be taxable in India. This income for the services rendered by you will be earned in India and will be paid to your Indian bank account, so it shall be taxable in India for you.

To understand whether this shall be treated as salary income or not, one has to look at the agreement between you and the other entity. If this is in the nature of an employment agreement, the payment shall be taxable under the head salary, otherwise it shall be taxable as income from other sources in India.

Archit Gupta is founder and chief executive officer, ClearTax. Queries and views at mintmoney@livemint.com

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