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taxation pertaining to NRI STATUS

(Querist) 27 January 2009 This query is : Resolved 
DEAR FRIENDS,PLEASE LET ME KNOW THAT IF A PERSON EMPLOYED IN A FOREIGN COMPANY IS WORKING ON A 3 MONTH CONTRACT DURING THE MONTHS OF FEBRUARY,MARCH AND APRIL.AND IF HE RECEIVES PAYMENT FOR HIS JOB IN THE MONTH OF APRIL(FOR ALL 3 MONTHS) .THEN WILL HE BE LIABLE TO PAY TAX ON CURRENT FINANCIAL YEAR OR THE NEXT FINANCIAL YEAR.LOOKING FORWARD TO AN EARLY REPLY.THANKS IN ADVANCE.
Ashok Kumar Garg (Expert) 28 January 2009
So far as salary income is concerned it is taxable also on due basis . This is clear from section 15(a) of the Income -tax Act. The relevant portion reads as under :
"any salary due from an employer or former employer to an assessee in the previous year whethre paid or not" .

It will be taxable in the year to which it relates.

In this case , absence for 3 months will not make any difference. If any tax has been withheld in foreign country , he may or may not get credit for the same depending on Double Taxation avoidance agreement with the concerned country.

Ashok Garg


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