TAXATION ON INDIAN CITIZEN OF INDIAN ORIGIN – A PARADIGM SHIFT
Explore the paradigm shift in taxation for Indian citizens and persons of Indian origin post-Union Budget. Stay informed on the evolving tax landscape.
Explore the paradigm shift in taxation for Indian citizens and persons of Indian origin post-Union Budget. Stay informed on the evolving tax landscape.
In this blog, the best Chartered Accountant Firm In India shall have a detailed analysis of the Budget-2020 proposal on residency provision under section 6 of the Income Tax Act, 1961, and its impact on Indian Citizen or persons of Indian origin who are non-residents. They may be asked to give the source of their foreign source income or ‘bloated income’.
Taxation may be based on 4 principles worldwide: i) a Citizenship system like the USA; ii) a Resident system like India; iii) a Source-based system like Hong Kong and iv) No tax on any Income or some income either Country/outside country source Income like Gulf Countries, Singapore (no capital gain tax), etc; meaning thereby taxing their citizen/residents on their worldwide Income and give relief on their source income from outside Country and only taxing their citizen/residents on their source Income in the Country of citizenship/resident not to tax their foreign source Income.
(These amendments will come into force from AY 2021-22.)
Though this proposal being made with good intentions of the Government; it is still to see how the government will ensure that the bonafide taxpayers will be fully protected.
Disclaimer: This content is meant for our clients or professional friends only to stimulate discussion on the subject matter not to frame any commercial opinion. All efforts are made to compile correctly with no guarantee of extreme accuracy
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