Rnor taxation query
Querist :
Anonymous
(Querist) 12 December 2023
This query is : Resolved
I am an Indian citizen but was in the US for a long time for work hence gained RNOR status. In 2021, I came back to India and continued to work remotely for my company from India for about 8 months. I stopped working after that and after 6 more months from then I again went to the US for work. In total, I was in India for about 1 year and still maintained my RNOR status. While I was working from India I didn’t file or pay any India taxes but continued to pay taxes TDS in the US as I was on the US company payroll and all my income was deposited to my US bank account. Is there anything I was supposed to do for taxes for India?
T. Kalaiselvan, Advocate
(Expert) 13 December 2023
It is pertinent that you have to pay the taxes for the income, whether it is in India or USA.
RNOR will be taxed only on income earned in India, unlike Indian residents who have to pay tax on global income.
Resident (RNOR) individuals who have recently returned to India, one can maintain their RNOR status for up to 3 financial years after their return. This can be highly beneficial for you because your taxation will be similar to an NRI's.
Querist :
Anonymous
(Querist) 24 December 2023
Thank you so much for your reply, T. Kalaiselvan.
Could you give more information about whether I have any tax liability towards India in this case? I was under valid RNOR status and the income was earned working remotely for the foreign company. I paid all my taxes deducted at source (TDS) in the US itself.
Do I need to file or pay any taxes to the Indian government? If so, is there a way to file belated taxes at this stage?
T. Kalaiselvan, Advocate
(Expert) 24 December 2023
In the case of a non-resident individual working abroad and providing services outside India, the salary credited to their NRE account with an Indian bank will not be considered part of their taxable income, even though it was credited to an Indian bank account.
However, in the case of Resident But Not Ordinarily Resident (RNOR) individuals who have recently returned to India, one can maintain their RNOR status for up to 3 financial years after their return.
This can be highly beneficial for you because your taxation will be similar to an NRI's. Hence, any income earned outside of India, even after your return, will not be taxed in India.
