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Are you an NRI or earning income abroad? You might be taxed in both countries — but here's how to avoid that. 👇

🔍 What is Double Taxation? Double taxation happens when income is taxed in two countries, often due to different tax systems (residency vs. source-based taxation). This impacts:

NRIs 🇮🇳🌍

Foreign investors 💸

Cross-border businesses 🏢

💼 DTAA (Double Taxation Avoidance Agreement) is a tax treaty between two countries to ensure you don’t pay tax twice on the same income.

🧾 DTAA Relief Methods:

✅ Tax Credit – Pay tax in one country, claim credit in the other ✅ Exemption – Income is taxed in only one of the two countries

📄 Documents Needed:

TRC (Tax Residency Certificate)

Form 67 (for claiming foreign tax credit)

DTAA declaration form

💡 DTAA helps you reduce your tax burden legally and avoid notices or penalties.

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Are you an Indian resident earning income from abroad? Whether it's a foreign salary, rent, dividends, or interest — global income is taxable in India and must be reported properly to avoid penalties. Here’s a complete guide to stay compliant 👇

✅ 1. Who Needs to Report?

Indian Residents: Must report and pay tax on global income

Non-Residents (NRIs): Taxed only on Indian-sourced income

📄 2. Where to Report Foreign Income in ITR?

➡️ Use Schedule FSI (Foreign Source Income) in your Income Tax Return (ITR) Disclose:

Type of income (e.g., salary, rent, dividends)

Foreign country of origin

Amount received and taxed

💡 3. Claim Foreign Tax Credit (FTC)

If you’ve paid tax abroad, avoid double taxation by claiming relief via: ✔️ Form 67 (must be filed before ITR submission) ✔️ DTAA (Double Taxation Avoidance Agreement)

🌐 4. Report Foreign Assets & Bank Accounts

Non-disclosure can attract steep penalties under the Black Money Act

Use Schedule FA to declare:

🏦 Foreign bank accounts 🏠 Overseas property 📈 Foreign shares or financial assets

🚨 5. Consequences of Non-Compliance

Penalty of ₹10 lakh per undisclosed foreign asset

Risk of interest, audit, and even prosecution

💬 Pro Tip: Always monitor your residential status and understand DTAA rules for your country of income to avoid costly errors.

🔗 Cross-Post Links:

📸 View full infographic on Flickr: 👉 https://www.flickr.com/photos/203245362@N06/54701137943/in/dateposted-public

🔍 What is FATCA? FATCA is a U.S. law that requires foreign financial institutions (like Indian banks and mutual funds) to report accounts held by U.S. taxpayers. India has signed an agreement with the U.S. to enforce FATCA compliance.

👥 Who Needs to Comply? Indian banks must collect FATCA declarations when opening accounts. Indian residents with U.S. ties must report global assets and income.

📋 How Does It Affect You? Non-compliance can result in blocked accounts or withheld transactions. Indian residents earning U.S. income must disclose it under Schedule FA in their ITR. Form 67 can be used to claim Foreign Tax Credit (FTC) and avoid double taxation under the India–U.S. DTAA.

⚠️ Penalties for Non-Disclosure: Up to ₹10 lakh per account under the Black Money Act. U.S. taxpayers risk IRS penalties for non-reporting.

🔹 1. Report It in Your ITR Indian residents must declare foreign earnings under “Income from Business/Profession.” Use ITR-3 (actual profits) or ITR-4 (presumptive under Section 44ADA).

🔹 2. Convert Using the Right Exchange Rate Use SBI’s TTBR (Telegraphic Transfer Buying Rate) on the last day of the financial year to convert foreign income to INR.

🔹 3. Claim DTAA Benefits If tax is already deducted abroad, avoid double taxation by filing Form 67 and claiming Foreign Tax Credit under the DTAA.

🔹 4. Schedule FSI Compliance Report country-wise foreign income and taxes paid in Schedule FSI in your ITR.

💡 Don’t miss out on deductions and tax credits you’re eligible for. Proper disclosure ensures compliance and peace of mind.

So, what exactly is DTAA (Double Taxation Avoidance Agreement)? It's basically an awesome agreement that stops you from getting taxed twice on the same foreign income. Yes, please! 🙌 And if you're an Indian resident, you're likely eligible for this sweet tax relief.

How do you even claim it? There are two main ways:

The Exemption Method: Your income gets taxed in just one country. Simple!

The Tax Credit Method: You get to deduct the tax you already paid abroad from your Indian tax bill. Smart, right?

Don't forget the paperwork! 📝 To claim DTAA, you'll need your Tax Residency Certificate (TRC), Form 10F, and solid proof of foreign income (like your payslips or bank statements). Keep those docs handy!

When you file your ITR, make sure to report your foreign income in ‘Schedule FSI’ and claim your tax credit in ‘Schedule TR’. It’s all about getting that proper adjustment on your Indian tax liability.

Quick heads-up on common mistakes to avoid:

Always be super accurate with your foreign income disclosure.

Make sure your TRC is valid.

Double-check that you're claiming the correct tax credit percentage based on the specific DTAA agreement.