I receive income from foreign clients through PayPal. The issue is that PayPal has its own set of charges and higher conversion rates.
If I receive $1000 from the foreign client, and Telegraphic rates is 83, than Paypal might give me rate of 80.
Now, for the purpose of taxation, what should I report for taxation?
-
Should I report Foreign Income in USD multiplied by the Telegraphic rate on that date?
-
OR should I report the exact INR that I received in my bank account?
The problem is that Paypal does not give any receipt for steep conversion rates, and it is a loss for me if I go with Option 1 of the telegraphic rate as there is no receipt to write it off as a business expense.
One more problem is that foreign client deducts 1% TDS and it is reported in my AIS. And they apply conversion rate that is more higher than TT rates :(
What can be done in this case?
CAclubindia
