How to avoid Double Taxation ?
What is the Tax for the Indians earning from abroad ?
Is the salary earned from foreign firm, Indian residents staying in abroad, taxable ?
What is the Income tax for abroad earnings ?
To help the Indians and to avoid this double taxation for the income earned by working in abroad, Government of India signed in an agreement with teh other governments of around sixty five countries like USA, UK, Canada, Australia, UAE, Singapore, Switzerland and so on. This agreement is known as Double Taxation Avoidance Agreement, DTAA. Also this can be covered in Section 90 of the Income Tax Act of India. This can be understood in two modes of relieving. In India double taxation is excluded byt the following two modes, via DTAA.
Mode 1 : Tax Exemption Method
This mode gives assurance to avoid the overlapping of tax completely. This overlapping is the income being taxed in both the countries.
Mode 2 : Tax Credit Method
This mode enable the tax deduction to the taxpayer for the tax in favor of India.
List Of DTAA Countries
Australia, Austria, Bangladesh, Belarus, Belgium, Brazil, Bulgaria, Canada, China, Cyprus, Czechoslovakia, Czech Republic, Denmark, Egypt, Finland, France, Germany, Greece, Hungary, Indonesia, Israel, Italy, Japan, Jordan, Kazakhstan, Kenya, Korea, Kyrgyzstan, Libya, Malaysia, Malta, Mauritius, Mongolia, Morocco, Namibia, Nepal, Netherlands, New Zealand, Norway, Oman, Philippines, Poland, Portugal, Qatar, Romania, Russian Federation, Singapore, South Africa, Spain, SriLanka, Sweden, Switzerland, Syria, Tanzania, Thailand, Trinidad and Tobago, Turkey, Turkmenistan, United Arab Emirates, United Kingdom, United States, Uzbekistan, Vietnam, Zambia, Non treaty countries.
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