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Charge to tax
Residence
Income from employment
Source of employment
Benefits (in kind)
Expatriate concessions
Relief for foreign taxes
Deductions against income
Charge to tax
A charge to India tax is determined by the expatriate's tax residency position.
Certain benefits are taxed in the hands of the employees as perquisite such as the value of rent-free accommodation, reimbursement of fuel and maintenance charges incurred on motor car, , provision of sweeper, watchman, gardener, watchman or personal attendant, supply of gas, electric energy or water for household, free or concessional educational facility for any member of employees household, interest free/concessional loan for housing, free food and non alcoholic beverages, gifts/vouchers or token to employees, membership fees and annual fess, use of movable assets (other than laptop), transfer of movable asset to employee, provision of Employee Stock Options Scheme (‘ESOP’) And other benefits, ameities or services.
Prescribed rules are laid down for the valuation of perquisites. Certain perquisites are taxable in hands of specified employees..
Expatriate concessions
Except for provisions dealing with short stay exemptions, no specific expatriate concessions are available under the Indian tax laws.
Relief for foreign taxes
Where income has been subject to tax twice; in India and a foreign jurisdiction, relief from double taxation may be available where provided for in the relevant double taxation agreement. Relief is also available to expatriates under Indian tax laws provided he or she fulfils the criteria of residency status during the year.
Deductions against income
Tax on employment (Profession Tax) is allowed as a deduction from salary income. In addition, the following are treated as allowances and exemptions are available from such allowances subject to the statutory conditions prescribed in this regard:
Information about India:
Last updated 6 April 2010
This information has been provided by Walker Chandiok Grant Thornton, the Indian member firm within Grant Thornton International Ltd and is for informational purposes only. Neither Walker Chandiok Grant Thornton or Grant Thornton International Ltd can guarantee the accuracy, timeliness or completeness of the data contained herein. As such, you should not act on the information without first seeking professional tax advice.
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