Do Foreigners Require Tax Clearance Before Leaving India?
April 22, 2008 by taxworry · Leave a Comment
The answer is Yes and No but before I explain the law , it is importanat to understand that here foreigner means a person not domiciled in India .
The answer is NO in case of following persons?
Those persons who are not domiciled in India and who come to India
The answer is NO in case of following persons?
Those persons who are not domiciled in India and who come to India
-
on tourist visa or
-
for any purpose other than business,employment or
-
who have no source of income in India ,
They are not required to obtain a tax clearance certificate from income tax department before leaving India.
The answer is YES in case of following persons?
The answer is Yes in case the person not domiciled in India visits India for any business purpose or employment or has any source of income in India . Subsection 1 of Section 230 of the I T Act is very clear on this which is given as under :
no person,
(a) who is not domiciled in India;
(b) who has come to India in connection with business, profession or employment; and
(c) who has income derived from any source in India, shall leave the territory of India by land, sea or air unless he furnishes to such authority as may be prescribed
The answer is Yes in case the person not domiciled in India visits India for any business purpose or employment or has any source of income in India . Subsection 1 of Section 230 of the I T Act is very clear on this which is given as under :
no person,
(a) who is not domiciled in India;
(b) who has come to India in connection with business, profession or employment; and
(c) who has income derived from any source in India, shall leave the territory of India by land, sea or air unless he furnishes to such authority as may be prescribed
(i) an undertaking in the prescribed form from his employer; or
(ii) through whom such person is in receipt of the income, to the effect that tax payable by such person who is not domiciled in India shall
be paid by the employer referred to in clause (i) or the person referred to in clause (ii), and the prescribed authority shall, on receipt of the undertaking, immediately give to such person a no objection certificate, for leaving India:
So what is the procedure?
Rule 43(1) of I T Rule provides the procedure of obtaining clearance certificate. It lays down that
- the undertaking will be given in form 31 to the assessing officer by the employer or the person through whom the non domiciled person is in receipt of any kind of income .
- After getting the undertaking in form 31 , the assessing officer shall issue a tax clearance certificate in Form 33.
The forms?
Form 31 can be obtained from here. and Form 33 can be obtained from here.
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Do You Need Tax Clearance For Foreign Visit?
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