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Tax on salary earned while on deputation outside India

sneha (chartered accountant) (16 Points)

31 December 2007

An employee of an Indian Software company, employed in Amasterdam for 1 yr. on deputation transfers his salary received in Euro to his Indian Salary account after payment of taxes out there. He is also in receipt of Salary in India from his company.

Whether the funds transferred in India would be taxable as salary income?

What difference would it make if the funds r transferred to parents in India.?

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3 Replies

Amit Sharma (article) (2677 Points)
Replied 31 December 2007

Dear Mam, (1) It would be not taxable, as (i) 182 days is not fulfilled. & DTAA too would come into play. (2) The amount tfd to parents will not attract any tax. Please do correct me if i am wrong.

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Sathish k (Partner) (116 Points)
Replied 31 December 2007

You can claim relief u/s 90 for the income earned abroad and the income earned in india is taxable.

(Guest)

The reference of One year (period of employment) have to be referred more specific to number of days in a Assessment year. Only this will help to determine a residential status of person and accordingly the tax incidence. For instance the person could have spent 1 year in abroad in two assessment years say 2006-2007 (185), 2007-2008 (180) days. So this will change the way the income tax works? I hope i made it clear. Every year have to be looking into and the residential status would be identified and then the income relating to it.