Tightening compliance requirements and improving enforcement structure being put in place by regulators across the globe have emphasized the need to have a structured process for compliance management. We help companies to identify and address legal and regulatory compliance requirements and implement a compliance management process for effective oversightand with a team comprising of experienced professionals from diversified backgrounds gives us an added advantage to provide you with comprehensive solutions under one roof.

BACKGROUND Any individual who is not a citizen of India is considered a foreign national. However, whether a foreign national is liable to pay Indian income tax is dependent on the individual’s physical presence in India, regardless of their citizenship or the purpose of the stay.

According to India’s Income Tax Act (ITA), there are three levels of residency for tax purposes:

• Non-resident – these individuals are not liable to income tax.
• Resident but not Ordinarily Resident (RNOR) – these individuals are taxed on their worldwide income and
• Resident and Ordinary Resident (ROR) - these individuals are tax only on their Indian sourced income.

To qualify as a non-resident, an individual must not stay in India for more than 182 days during a fiscal year (FY), or more than 365 days in four consecutive FYs preceding the relevant FY. Any individual not meeting these conditions becomes a resident for tax purposes either as a ROR or RNOR.

The Indian tax year i.e. Fiscal year (FY) runs from April 1 to March 31. Total income tax is calculated in accordance with the tax rates and rules that stand on the first day of April of the assessment year.

COMPONENTS OF INCOME

In India, Income is categorised in 5 categories i.e.

• Income from Salary
• Income from House Property
• Income from Business of Profession
• Income from Capital Gains
• Income from Other Sources

FILING INCOME TAX RETURN

Income tax return has to be filed online. A computation of income will be prepared taking into account the income of the Assessee. Since most of the expatriates are working in India, they will be treated as RESIDENT and worldwide income will be taxable.

The income tax return has to be filed by 31st July for the preceding Fiscal year (FY).