nri,stax liability
k.k.jandial
(Querist) 26 January 2010
This query is : Resolved
Hi sirs,
My son is having interest income from banks FD,S in India only who is residing at Singapore at present & I have the power of attorney to operate his bank accounts and other related maatters,,in India, my querry is-
1. whether tds on fds deducted by bank @ 30% is refundable on filing return wih ITDeptt.
2.Is Rs. 160000/ income is not taxable .
3. Is rebate of RS. 100,000/ u/s 80(c) is admissible .
4 Are usual tax slabs are applicable if not which tax slabs will be applicable.
5. Any other relevant iformation useful in the present case may also be intmated.
Thanking you.
K.K.Jandial
A V Vishal
(Expert) 26 January 2010
The persons who are liable to pay income tax and against whom proceeding for assessment are taken under the Act, are known as 'Assessees'. These persons can be natural persons or artificial juridical persons like, corporations, local authorities etc. Different rules for computation of income and tax exist for different types of persons.
All the persons, are further categorised on the basis of their residence in the taxable territory i.e. India. The residential status of a person is necessary to be known, as the tax liability is dependent on such status. Based on residence, a person can be:-
resident; or
non-resident
In order to be a resident, an individual should have been present in India in the previous year for at least 182 days. This period of 182 days need not be continuous. Special rules exist for the person who left India in any earlier year and has been visiting India so that his total stay in the preceding four years has been at least 365 days. Such a person is considered resident even if in the previous year under consideration, he stays in India for 60 days only. This rule, however, does not apply to a member of the crew of an Indian ship and to a citizen of India or a person of an Indian origin (Known as Non-resident Indian). The residence of such persons is under all circumstances governed by the general condition i.e., they become residents only if their stay in any particular year is 182 days or more.
All those persons who are not 'residents' are called 'nonĂ‚Âresidents'.
There is a special Category of 'resident' persons, known as 'not ordinarily residents' in India. This category is carved out of the category of residents for those who have for a long time remained out of India arid for reason of the prescribed period of stay in any particular year acquire the status of resident in that year. This is to ensure that they are not saddled with higher tax liability of a resident by casual change in status. In order to fall in this category, one must satisfy either of the following two conditions:-
he should not have had the status of 'resident' in nine out of ten preceding previous years; or
he should not have stayed in India for an aggregate period of 732 days or more in the preceding seven previous years.
Based on the residential status of a tax payer and the place where the income is earned, the income that is included in the total income is as under:-
Residential status Nature of Income
1. Resident :- All Income whether earned in India or outside India.
2. Not ordinarily resident All income:-earned in India; and
all income earned outside India if the same is derived from a business which is controlled in India or from a profession which is set up in India
3. Non-resident:- All income earned in India.
So based on the rules of residence your son will be taxed. In your query the status of residence is not mentioned, assuming that your son is a resident and not ordinarily resident, the tax incidence would be Income upto 1.60 lacs will be exempt. Rebate u/s.80C can be claimed. You can file for refund of the excess TDS on interest on FD's.
Raj Kumar Makkad
(Expert) 27 January 2010
Nothing to add in the wise opinion of vishal
k.k.jandial
(Querist) 27 January 2010
Dear vishal,
Thanks for quick & appropriate &useful reply.
K.K.Jandial
Kumar Thadhani
(Expert) 27 January 2010
first let me know bank account in which interest income in which is deposited is ordinarily saving account or NRE /O account if it is NRE/ O account then find out status that he is RESIDENT or NON-RESIDENT as stated by expert mr vishal if then he is NON-RESIDENT THE whole of that income that is not taxable provided if it does not exceeds taxable limits.File form no 15-G with your bank for not deducting your TDS from interest next time. For TDS already deducted at source FILE IncomeTAX Return FORMno 1 for Refund of TAX(TDS) ALRADY deducted.
k.k.jandial
(Querist) 28 January 2010
Dear kumar ji,
It is NRE A/c with icici bank from which Fd,s from ICICI housing Fiance Co. have been taken who has categorised it u/nre status. Co has also intimated that Form 15G is not applicabe and returned these forms.
Pl. under so these cicumstances advise me regarding non-taxable limt, rates of tax applicable, deductions u/sec 80,soas to make tax/investment planning.
Any other advice will be highly appreciated.
K.K.Jandial
k.k.jandial
(Querist) 29 January 2010
keep the querry open pl.
A. A. JOSE
(Expert) 26 July 2011
Well explained by Mr.Vishal.
