CBDT: Relief to NRIs Till 31st March But Doubt Stable in Double Taxation

The Central Board of Direct Taxes (CBDT) directed that the Indian Laws and the double tax avoidance treaties give enough security to NRIs and expats who were helpless in India because of Covid-19 from the possibility to furnish taxes in 2 countries on a similar income in FY21.

CBDT told in the circular provided on Wednesday that although there is no double taxation implementation of their income in 2020-21 as per the protection under domestic law as well as tax arrangements, it will take the details from these individuals about the possible circumstances for the double taxation. Towards that Central Board of Direct Taxes (CBDT) has provided the option to the individual who had come to India in FY20 but did not return because of suspension of the international flight to elaborate the conditions, till March-end.

CBDT declares the “After understanding the possible situations of double taxation, the Board shall examine whether any relaxation is required to be provided in this matter and if required, then whether general relaxation can be provided for a class of individuals or specific relaxation is required to be provided in individual cases,”

The main body of the direct tax scheme These types of taxes are directly imposed and paid to the government of India. Example of Direct Tax is Income Tax, TDS, Securities Transaction Tax, Fringe Benefit Tax, etc has elaborated that there are very lower chances of the individual acquiring the property status in India towards the tax purposes in FY 21 as the particular conditions are needed to be met staying in India for 182 days or excess in the present year. If the income in India exceeds Rs 15 lakh who stays in India for 120 days in FY 21 and holds his stay for 365 days in the last 4 years will secure him a resident for tax purposes.

The countries that have the condition for 182 days stay or exceed for asking the residency. Thus the individual in most of the conditions will be resident in only 1 country since there are 365 days in the year. “In fact, if general relaxation for the stay period of 182 days is provided, there may be cases of double non-residency. In such a situation, a person may not become a tax resident in any country in 2020-21 even after staying for more than 182 days or more in India resulting in double non-taxation and end up not paying tax in any country,” CBDT clarified that why it seeks another detail from the single person prior to providing the exemption.

A resident’s global income will be taxed in India despite the non-resident only needing to furnish the taxes upon the Indian income. CBDT had moreover not included the covid-19 duration prolonged stay and had quarantine time for tax residence computation for FY20.