If you earn income from India but are not a resident, it is subject to Indian Taxation, and the payer in India will deduct the same in the form of Tax Deducted Source (TDS) also known as Withholding Tax (WHT). This means that you shall receive less amount than what you have billed for.
Following are some common types of Income that are liable to TDS:
- Professional/technical service fees
- Royalty payments
- Interest income
- Dividend income
However, In such income, you can claim a lower tax rate which is possible if you are a resident of a country that has a Double Taxation Avoidance Agreement (DTAA) with India. India has agreements with more than 85 nations, allowing qualified taxpayers to take advantage of lower tax rates on particular income categories.
How to Claim DTAA benefits:
- Tax Residency Certificate (TRC):Now the most crucial document for you to claim the benefit is the Tax Residency certificate (TRC) this is issued by the tax authority of your country and that proves that you are a tax resident there. The TRC should have the following fields: Name, Address, Tax Identification Number (TIN), Residency Status.
- Form 10F: If your Tax residency certificate (TIN) is missing any of the above-mentioned fields, then you must electronically file Form 10F to the Indian Income Tax Department.
How to File Form 10F Electronically in India:
Non-residents must comply with Indian tax regulations by submitting Form 10F electronically through the income tax e-filing portal. To do so, they need to register online and provide details such as:
- Name
- Date of Incorporation
- Tax Identification Number (TIN)
- Country of residence
- Name of key person
- DOB of key person
- TIN of key person
- Designation
- Mobile number
- Email ID
- Address
- Proof of TIN for both the company and key individuals.
How KDP accountants can help you with filing Form 10F:
Although filing Form 10F claims are simple, it is important to ensure that your application is error-free to avoid delays and rejections. The requirements set by Indian tax authorities can be complex, and if the information is missed this may lead to higher tax deductions. Professional advice is also very important because NRI tax benefits in India can vary depending on the DTAA laws that apply to your country's residence.
At KDP accountants, we specialize in international tax compliance , and we help people and companies claim DTAA tax benefits. With our expert assistance, we make sure that all required paperwork is filed accurately so you can take advantage of lower tax rates on your Indian income.
If you require any assistance while filing Form 10F compliance or any inquiries about DTAA benefits, connect with us at enquire@kdpaccountants.com .
