Legal & income Tax


The rate for deduction of tax at source is 30% or the rated specified in the double taxation treaty with the country, whichever is lower.
  1. There is no formal declaration for an NRI status. This has to be indicated in the return of income or other designated forms.
  2. The shares can be sold and the status can be indicated while filing the return of income.
  3. For listed shares the holding period is 12 months and long-term capital gains tax will not apply.
  4. Repatriation is permitted with the specific approval of RBI.
  5. I will be in Singapore on Employment Pass for 4 months. My salary will be paid by my company's branch office there in Singapore Dollars. I will be paying Tax @15% in Singapore. I am in the 30% Tax bracket in India. Will I have to pay tax in India when I return, for the Total Salary earned in Singapore? If so, what is the % of Tax? Is there a Tax credit for the Tax paid in Singapore?
  6. The capital gains tax will be computed taking the cost of acquisition as the capital and the sale consideration as the sale price.
You will have to pay tax in India for your total income earned which includes the income earned in Singapore. The tax rates are based on the slab system with a maximum rate of 30% plus surcharge of 10% if the income exceeds 10 lakh plus education cess of 2% on the tax. The tax paid in Singapore can be availed as a credit on the tax payable in India.
The tax liability for the period April 04 to June 04 will depend on the total income earned for the period April 04 to March 05. The max marginal rate is 30%. The 15% tax paid in Singapore can be set off against the tax liability in India.
The tax on long-term capital gains is 20% plus surcharge. On other categories of income it is on the slab rate with a maximum of 30%plus surcharge. The holding period for asset based in US is 36 months to rank for long-term capital gains. The tax rates for mutual funds in India are the same.
In your return of income filed in India you need to disclose you are an NRI. You will have to offer the income earned in India and pay taxes in India. The question of offering the US income does not arise since you are an NRI.

I am US Citizen but born in India and recently my Father also became U.S.citizen. My mother has green card and we have applied for her U.S. Citizenship.

Presently, the said transaction would not have any tax implication in India. However, given the status of you and your father the implications in US should be independently checked. Repatriation up to 100,000 USD should be possible with RBI approval in the circumstances mentioned by you.

I am a US citizen and a PIO and retired. I have been visiting/living in India on and off and for FY 2005-6 I will be ROR per income tax law. My only Indian source income is nominal interest from ordinary SBI SB A/c (< Rs.8000). My US source income falls under capitals gains and interest. No salary or pension. I understand that India-US DTAA and tie-breaker rules are applied because of dual residency.


The issue of dual residency is never easy to resolve and in sticky cases the matter would need to be resolved directly between two tax authorities. It is difficult to opine on this in the absence of information on what the residential status has been in a few preceding years. Looks that ROR in India will cause the worldwide income to be aggregated here and in any event income doubly taxed will be mitigated through tax credits. It would be advisable to have the position crystallised with direct professional help.
Not a pre-condition to file a return on income. Monthly income form fixed deposit is taxable. Filing of return cannot avoid the tax liability.
File a return of income in India disclosing global income since you are a resident assessee. Claim the US TDS as credit against the taxes payable in India.