Taxation of Income of Non-Residents Under Direct Tax Law (As Amended by Finance Act, 2024)

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Description
In a liberalized economy, more and more citizens of the country are going to work and earn income in foreign countries. Since they spent more than 182 days in foreign countries, they have become Non-Resident in India. Often these taxpayers are not adequately equipped to understand the taxability of their Indian income. This book has been written for the guidance of these growing Non-Resident Indian (NRI) taxpayers whose income is taxable in India. This book deals with the various aspects of taxation of Non-Resident Indians (NRIs). The law of taxation of Non-Resident Indians (NRIs) is highly complex and has always been the subject-matter of frequent  amendments. An attempt has been made to produce most of the important aspects relating to taxation of Non-Resident Indian (NRI). I would like to place on record a special note of gratitude to Sh. Ashok Kumar Manchanda, IRS (1976 Batch), who has been the guiding force for this venture and a constant source of inspiration in my life.I also express my thanks to Commercial Law Publishers (India) Pvt. Ltd. who reposed confidence in me and readily agreed to be publishers of this book. They have done a good job in making this volume attractive, acceptable and useful. It is hoped that this second edition of this book will be found very useful by Non-Resident Indian (NRI) taxpayers in discharging their tax obligations. The views and opinions expressed in this book are the personal opinion of the authors and not that of Government of India and are not binding on any person. It is advised that a reference be made to the tax authorities /relevant laws/rules etc. before taking a decision arrived at by any Non-Resident Indian (NRI) basing his judgment on the book. We would welcome any suggestion to further improve this book.
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Contents
Chapter 1. Introduction
Chapter 2. Non Resident Status : Scope of Total Income [Sec. 5(2)]
Chapter 3. Residential Status [Sec. 6]
Chapter 4: Indian Citizen who is not liable to Tax in any other Country or Territory shall be Deemed to be Resident in India [Section6(1A)]
Chapter 5: Residential Status of a Hindu Undivided Family, firm or other Association of Persons [Section 6(2)]
Chapter 6: Residential Status of a Company [Section 6(3)]
Chapter 7: Determination of Place of Effective Management (POEM). Concept of Place of effective management
Chapter 8: Different Residential Status in Respect of different Previou Years of the same Assessment Year not Possible [Section 6(5)]
Chapter 9: Resident but not Ordinarily Resident (RNOR)) [Section 6(6)]
Chapter 10: Non Resident Status under Foreign Exchange Management Act, 1999 (FEMA)
Chapter 11: Income Deemed to Accrue or Arise in India [Section 9(1)]
Chapter 12: Incidence of Tax in Respect of Non-Resident
Chapter 13: Incomes of Non-Resident Indians (NRIs) which do not form Part of Total Income (Exempt Income) )[Section 10)]
Chapter 13: Incomes of Non-Resident Indians (NRIs) which do not form Part of Total Income (Exempt Income) )[Section 10)]
Chapter 14: Exemption of Income of a Non-Resident from Transfer of Non-Deliverable Forward Contracts, Offshore Derivative Instrument [Section 10(4E)]
Chapter 15: Computation of Income of Non Resident     
Chapter 16: Income from Salary of a Non-Resident Indian
Chapter 17: Income Falling under the Head Salaries – if it is Earned in India [Section 9(1)(ii)]
Chapter 18: Income Falling under the Head Salaries – if Payable by the Government to a Citizen of India for Service Outside India [Section 9(1)(iii)]
Chapter 19: Taxation of Seafarer Income in India
Chapter 20: Taxability of Secondment of Employees     
Chapter 21: Income from House Property of a Non-Resident     
Chapter 22: Income from Business or Profession of a Non-Resident     
Chapter 23: Income from Business Connection in India [Section 9(1)(i)]
Chapter 24: Certain Activities not to Constitute Business Connection in India [Section 9A]
Chapter 25: Deduction of Head Office Expenditure in the Case of Non-Residents [Section 44C]
Chapter 26: Applicability of Permanent Establishment (PE) in India and its Impact
Chapter 27: Liaison Office of a Foreign Company in India
Chapter 28: Special provision for Computing Profits and Gains of Shipping Business other than Cruise Shipping in the Case of Non-Residents [Section 44B]
Chapter 29: Special Provision for Computing Profits and Gains of Business of Operation of Cruise Ships in case of Non-Residents [Section 44BBC]
Chapter 30: Shipping Business of Non-Residents – Levy and Recovery of Tax [Section 172]
Chapter 31: Computing Profits and Gains in Connection with the Business of Exploration, etc., of Mineral Oils [Section 44BB]
Chapter 32: Computing Profits and Gains of the Business of Operation of Aircraft in the Case of Non-Residents [Section 44BBA]
Chapter 33: Computing Profits and Gains of Foreign Companies Engaged in the Business of Civil Construction, etc., in Certain Turnkey Power Projects [Section 44BBB]
Chapter 34: Income from Other Sources of a Non Resident
Chapter 35: Dividend Paid by an Indian Company Outside India Taxable in India [Section 9(1)(iv)]
Chapter 36: Income by way of Interest Payable by – the Government of India, or by a Resident or a Non-Resident Certain Situations [Section 9(1)(v)]
Chapter 37: Income by way of Royalty which is Payable by – the Government, Resident or by a Non-Resident [Section 9(1)(vi)]
Chapter 38: Special Provisions for Computing Income by way of Royalties, etc., in the Case of Foreign Companies [Section 44D]
Chapter 39: Special Provision for Computing Income by way of Royalties, etc., in Case of Non-Residents [Section 44DA]
Chapter 40: Income by way of Fees for Technical Services (FTS) [Section 9(1)(vii)]
Chapter 41: Deemed Accrual of Gift Made to a Person Outside India by Resident [Section 9(1)(viii)]
Chapter 42: Income from Capital Gains of a Non-Resident
Chapter 43: Purchase of Immovable Property by Non-Resident Indian in India – Income Tax Implications
Chapter 44: Residents – Purchase a Property Abroad – Income Tax Implications
Chapter 45: Taxation of Income Received by Non-Resident Indian from Foreign Currency Assets [Section 115AB]
Chapter 46: Tax on Income from Bonds or Global Depository Receipts Purchased in Foreign Currency or Capital Gains Arising from their Transfer [Section 115AC]
Chapter 47: Tax on Income from Global Depository Receipts Purchased in Foreign Currency or Capital Gains Arising from their Transfer [Section 115ACA]
Chapter 48: Tax on Income of Specified Fund or Investment Division of an Offshore Banking Unit or Foreign Institutional Investor from Securities or Capital Gains Arising from their Transfer [Section 115AD]
Chapter 49: Tax on Investment Income and Long-Term Capital Gains [Section 115E]
Chapter 50: Capital Gains on Transfer of Foreign Exchange Assets by a Non-Resident Indian (NRI) not to be Charged in Certain Cases [Section 115F]
Chapter 51: Double Taxation Avoidance Agreements (DTAA)
Chapter 52: Agreement with Foreign Countries or Specified Territories [Section 90]
Chapter 53: Adoption by Central Government of Agreement between Specified Associations for Double Taxation Relief [Section 90A]
Chapter 54: Countries with which no Agreement Exists [Section 91]
Chapter 55: “Tax Residency Certificate” (TRC)
Chapter 56: Transfer Pricing [Section 92 to 92F]
Chapter 57: Safe Harbour Rules [Section 92CB]
Chapter 58: Reference to Dispute Resolution Panel [Section 144C]
Chapter 59: Mutual Agreement Procedure (MAP) – An Alternative Dispute Resolution Mechanism
Chapter 60: Concept of Most Favoured Nation (MFN) Clause
Chapter 61: Concept of 'Make Available Clausee
Chapter 62: Foreign Tax Credit (FTC) on Taxes Paid
Chapter 63: Taxability of Income from Dividends or Interest in the Case of Non-Residents [Section 115A
Chapter 64: Tax on Income of Non-Resident Sportsmen/Sports Associations or Entertainer [Section 115BBA]
Chapter 65: Special Provision for Computation of Total Income of Non-Residents [Section 115D]
Chapter 66: Special Provisions not to Apply if Non-Resident Indian -Assessee so Chooses [Section 115-I]
Chapter 67: Agent in Relation to a Non-Resident [Section 163]. Who may be regarded as agent
Chapter 68: Recovery of Tax in Respect of Non-Resident from his Assets [Section 173]
Chapter 69: Assessment of Persons Leaving India [Section 174]
Chapter 70: Deductions from Total Income Available to
Non-Resident Indians (NRIs)
Chapter 71: TDS from Payments to Non-Resident Sportsmen or Sports Associations [Section 194E]
Chapter 72: Tax Deductions at Source for Non-Resident Indians [Section 195]
Chapter 73: Application by Payer to Assessing Officer for Determining Appropriate Portion of Sum Chargeable [Section 195(2)]
Chapter 74: Application by the "Payee" to the Assessing Officer for a Certificate without Deduction of Tax at Source
[Section 195(3)]
Chapter 75: Payments Made to Non-Residents & Requirement to Furnish Form No. 15CA/ Form No. 15CB/ Form
No. 15CC Arises from Section 195(6) [Section 195(6)]
Chapter 76: Income Payable "Net of Tax" "[Section 195A]
Chapter 77: TDS from Income in Respect of Units of Non-Residents [Section 196A]
Chapter 78: Certificate for Deduction at Lower Rate [Section 197]
Chapter 79: Consequences of Non-Compliance of TDS Provisions
Chapter 80: Tax Clearance Certificate [Section 230]
Chapter 81: Refund for Denying Liability to Deduct Tax in Certain Cases [Section 239A]
Chapter 82: Authority for Advance Rulings [Section 245N to 245W]
Chapter 83: Non-Resident Indians (NRIS) Investment in India-General Permissions
Chapter 84: Portfolio Investment Scheme
Chapter 85: Barred Investment
Chapter 86: Resident - Overseas Investments.
Chapter 87: Residents - Borrowing & Lending from a Person Resident Outside India
Chapter 88: Non-Resident Indian's Bank Accounts in India
Chapter 89: Remittance of Funds
Chapter 90: Spending Forex Limits Going Abroad
Chapter 91: Liberalised Remittance Scheme (LRS) for Resident Individuals
Chapter 92: Non-Resident Indians (NRIs) - Gift. Gift Tax in India
Chapter 93: Filing of Income Tax Return by Non-Resident Indian Non-Resident Indians (NRIs) have to file return of income
Chapter 94: Return of Income not to be Filed in Certain Cases [Section 115-G].
Chapter 95: Turning into a Non-Resident Indian (NRI) – Check Points
Chapter 96: Returning NRI - A Non-Resident when Becomes Resident of India - Taxation
Chapter 97: Benefit under Chapter XII-A to be Available in Certain Cases Even after the Assessee Becomes Resident [Section 115-H]
Chapter 98: Non-Resident - Requirement of Obtaining Permanent Account Number (PAN) & Aadhaar Card
Chapter 99: Person of Indian Origin (PIO)
Chapter 100: Overseas Citizen of India (OCI) Card
Chapter 101: Tax Rates from Assessment Year 2020-21 Onwards.
Chapter 102: Jurisdiction of International Taxation
Chapter 103: Organization for Economic Cooperation and Development [OECD]
Chapter 104: Equalisation Levy
Chapter 105: Frequently Asked Questions
Chapter 106: Population of Overseas Indians in 2023: Country Wise
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Author Details
Ram Dutt Sharma got his post-graduation (M.Sc.) from M.D. University, Rohtak in 1980. He joined the Income-tax Department in the year 1983 and presently working as Income Tax Officer in Faridabad. He worked at various stations of North-West Region of Income Tax Department. He has wide experience of all wings of Income Tax Department such as assessment unit, Special Range, TDS Wing, Investigation Wing, Intelligence and Criminal Investigation etc. He has been contributing articles and addressing on topics relating to Income Tax at Direct Tax, Regional Training Institute, Chandigarh. He has also addressed number of seminars organized by the Income-tax Department, Chartered Accountants, Advocates and various Trade Associations. He is the author of number of books on direct taxes, namely Computation of income from salary under income tax law with tax planning, Computation of income from house property, Formation and Management of Charitable and Religious Trust, Educational and Medical Institutions under income-tax law, Taxation of Non-Resident Indians under income-tax law etc. which have been highly appreciated by the readers.