Wednesday 19 February 2020 6:22 AM UTC
MUMBAI Feb 19: According to the Finance Bill 2020, Indian citizens not paying tax in other countries will be taxed on their overseas income and assets.
There is increasing concern that the Income Tax (I-T) Department might question Indians living abroad over inflated income, according to a report by The Economic Times.
This means that those declaring fake overseas income to whitewash funds, such as trading profits, consultancy fee, and high salaries, will be questioned, the report said.
After Budget 2020, the government said that non-resident Indians (NRIs) would not be taxed on money they had earned as “bona fide workers” abroad. According to the Finance Bill 2020, Indian citizens not paying tax in other countries will be taxed on their overseas income and assets.
“The burden has now shifted to assessees to prove that they earned abroad as ‘bona fide workers’. This is in line with the government’s press release, though no such term exists in the law,” chartered accountant Dilip Lakhani told ET.
Not all NRIs qualify as “bona fide workers” overseas since they earn income from business, executive positions or as promoter of foreign JVs, Lakhani said.
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