Tax Rules for Residents Living in a Foreign Country

When an individual is residing in Foreign country and earning in dollars but having some of his amount invested in Indian banks in the form of FD’s & RD’s, it will be termed as “Person living in a foreign country”.

Tax Rules for Residents living in a Foreign Country

For example - Rahul is living in US from last 3 years and earning in US dollars. He has some of his amount invested in Indian bank accounts in the form of savings and fixed deposits. He bought an apartment and given on a rent to a tenant for Rs. 40000. He gifted a car to his parents and started transferring Rs. 10000 to their parent’s account every month in order to meet the household expenses during a year. He also transferred the amount of Rs. 20000 to his father’s account in order to pay the cost of Insurance policy which he has purchased for his parents.

Rental Income Rs.4,80,000
Less: Standard 30% deduction under Section 24 Rs.144,000
Income from house property Rs.3,36,000
Income from FDs and bank account Rs.30,000
Gross total income Rs.3,66,000
Deduction under Section 80D Rs.30,000 (Claim up to Rs.50000
Taxable income Rs.3,36,000

Rahul’s gift to his father and a transfer of Rs. 10000 every month towards household expenses are exempted from tax. As far as insurance policy amount is concerned, Rahul can claim a deduction under Section 80D for Rs. 25000 as his father is a senior citizen. Hence, he has to file income tax return in India as his income is more than Rs.250000.

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Due Dates

  • Due date for deposit of TDS for the period October 2021 to December 2021 when Assessing Officer has permitted quarterly deposit of TDS under section 192, section 194A, section 194D or section 194H

    Jan 07th ,2022
  • Due date for deposit of Tax deducted/collected for the month of December, 2021. However, all the sum deducted/collected by an office of the government shall be paid to the credit of the Central Government on the same day where tax is paid without production of an Income-tax Challan

    Jan 07th ,2022
  • Due date for issue of TDS Certificate for tax deducted under section 194-IA in the month of November, 2021

    Jan 14th ,2022
  • Due date for issue of TDS Certificate for tax deducted under section 194-IB in the month of November, 2021

    Jan 14th ,2022
  • Due date for issue of TDS Certificate for tax deducted under section 194M in the month of November, 2021

    Jan 14th ,2022
  • Due date for filing of audit report under section 44AB for the assessment year 2021-22 in the case of a corporate-assessee or non-corporate assessee (who was required to submit his/its return of income on October 31, 2021)

    The due date for filing of audit report for Assessment Year 2021-22 has been extended vide Circular no. 17/2021, dated 09-09-2021

    Jan 15th ,2022