Tax refund from foreign to a resident in India is taxable?
I returned from Japan in 2013,March after three years of my service. In December, 2013, I got my pension amount from Japan after the tax deduction there. I treated this amount as per DTAA. Then, in 2014, May, I got tax refund from tax deducted that of my pension amount. Now, I want to know if this tax refund be added to my Indian income and taxed here ?
Sir, does that mean I don't need to show this foreign tax refund into my Indian account as income from abroad in the ITR?
Yes. You are correct.
I think your conversation is going on with our other professional colleague. Will wait
Dear Sir,
As per the information provided by you, it appears that whatever income you are receiving as of now is a mere remittance of the Income earned abroad when you were working there and were a Non - Resident in India. In such a case Income earned abroad shall not be taxed in India even though received now when you are in India.
Please correct me if any of the facts on which I have based my conclusion is wrong.
Trust this clarifies your query.
Please feel free to call/ get back in case of any further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
Dear Sir Thank you very much for replying. Now I am getting confused with two experts' different views. Let me clarify few things. I was in job in Japan from 2010 to 2013, March. So, I was non-resident till then. After coming back to India, I got some lump sum amount as my pension. This amount is after tax deduction in Japan. Then I filed ITR there through POA and I got some amount as tax refund in May, 2014. Now there are two assessment years for which I have the confusion. 1. AY 2014 -15 -> I have Indian income + lump sum pension amount from Japan for my NRI period. I considered this pension amount as my foreign income in 2013 and filed ITR -2 treated as per DTAA. This I guess is now wrong as per Mr. Rohit R Sharma. This ITR is transferred to AO and I am living in a different city. 2. AY 2015 -16-> Indian income + tax refund from japan. Not yet filed ITR for this confusion. Now could you please guide for these two cases with clarity.
Let the professionals who answered the question previously answer the same.
Dear Sir,
AY 2014-15 : Indian income will be taxable in India.
Pension received for service in Japan, received in Japan and remitted in India will not be taxable in India.
AY 2015-16 : Indian income taxable in India.
Tax Refund from Japan - Amount of Refund is not taxable in India but Interest on Refund (if any) will be taxable in India.
Trust this clarifies your query.
Please feel free to call/ get back in case of any further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
Dear Sir,
Please find the response below:
AY 2014-15
Income earned in India will be taxable in India.
Pension received for service in Japan will not be taxable in India.
AY 2015-16
Income earned in India will be taxable in India.
Tax Refund from Japan - Refund of tax is not taxable in India but Interest received on tax refund will be taxable in India, if any.
Thanks and Regards,
CA Abhishek Dugar