Foreign Tax Credit Cannot Be Denied Merely for Late Filing of Form 67: ITAT Bangalore Ruling Explained A recent decision of the Income Tax Appellate Tribunal, Bangalore brings meaningful relief to taxpayers claiming Foreign Tax Credit. The Tribunal held that a genuine Foreign Tax Credit claim should not be rejected only because Form 67 was …
Applicability of TDS on Honorarium (Non-Resident Guest Lecturer) The Income Tax Act does not define “honorarium”; as per the general dictionary meaning, an honorarium is a small, voluntary payment made as a token of appreciation, typically for services that are not rendered under a formal employment or contractual obligation. “Honorarium” is a vague and non-technical …
Principal Purpose Test (PPT) under India’s DTAA The Principal Purpose Test (PPT) is an anti-abuse provision incorporated into India’s Double Taxation Avoidance Agreements (DTAAs) in line with the OECD’s Base Erosion and Profit Shifting (BEPS) Action Plan 6. The PPT aims to prevent treaty abuse by denying treaty benefits if obtaining such benefits was one …
Complete Understanding of Section 44BBD of the Income-tax Act, 1961 – New Presumptive Tax Regime for Non-Residents Introduction The Finance Bill, 2025, introduces Section 44BBD, which establishes a presumptive taxation regime for non-resident entities providing technology and services to Indian companies operating in the electronics manufacturing sector. This move simplifies tax compliance for foreign entities …
ITAT Chandigarh Order Assessee Regarding FTC not be denied merely on procedural lapses if substantive conditions are met. Income Tax Appellate Tribunal Chandigarh in the case of Ashish Sood vs. DCIT (order dated 23.04.2024) ruled in favor of the assessee regarding the foreign tax credit claim. foreign tax credit should not be denied merely on …
Impact on ITR has to be filed by non-residents in the case earning royalty/FTS income key implications of the Section 115A amendment and its impact on ITR filing for non-residents earning royalty/FTS income: Amendment in Section 115A (2023): The withholding tax rate for fee for technical services (FTS) increased to 20% + surcharge + cess, …
Form No. 67 filling for availing the foreign tax credit, is directory in nature & not compulsory. In Matter of Ms. Brinda Ramakrishna v. Income tax Office [2022], it was determined that Rule 128(9) of the Rules does not provide for disallowance of a foreign tax credit in the event of a delay in completing …
Guidance on ITR Reporting of Foreign Equity/Debt Investments When filing your Income Tax return in India, it is essential to declare foreign stocks and other foreign assets annually, regardless of whether they are sold or not. Income Tax Return Reporting of Foreign Assets in the ITR Return Form: All foreign assets, including stocks, real estate, …
Interpretation of “May be Taxed” in DTAAs In the context of Double Taxation Avoidance Agreements (DTAAs), the terminology used to describe taxing rights can significantly impact the taxation process. The term “may be taxed” in Double Taxation Avoidance Agreements does not grant absolute power to either state to tax the income exclusively. Instead, it allows …
Tax Residency Certificate is the valid document for determining treaty advantages. ITAT- Delhi – M/s Sarva Capital LLC (ITA No. 2073/Del/2023): Tax Residency Certificate is the valid document for determining treaty advantages. Facts of the Case: M/s Sarva Capital LLC, a non-resident corporate entity that was established in accordance with Mauritiusan legislation and is involved …