Income from services abroad not taxable in India

I have been working in Nigeria since September 2013. I have completed 185 days of stay outside India in the financial year of 2013-14. My offshore salary gets credited from Singapore to a normal savings bank account in India. Am I supposed to pay any tax for FY2013-14?

To have the non-resident Indian status for FY2014-15, do I again need to complete 183 days stay outside India? —Snehanshu Mohan Dutta Considering that your stay in India does not equal to 182 days or more during FY14 due to employment outside India, you would qualify as a non-resident as per income tax laws in India. In case of a non-resident, only such income which is received, accrues, arises or is deemed to accrue or arise in India is taxable in India. Income in the nature of salary is deemed to accrue or arise in India only if the services are rendered in India.

 Since the services in your case are rendered outside India, the salary income can be stated to be accruing outside India. However, since you receive the salary in your savings bank account in India, a question also arises whether the salary credited in India is considered to be received or deemed to be received in India. The Agra bench of the Income-tax Appellate Tribunal (ITAT) in a recent judgement in the case of Arvind Singh Chauhan vs. ITO (ITA No. 319 and 320/Agr/2013) held that the income earned by the individual from a shipping company and credited to the Non-resident Rupee (NRE) account in India is not taxable as it does not accrue or arise in India and cannot be deemed to accrue or arise in India as the services were rendered outside India. Further, the Tribunal held that the income should also be considered to be received outside India as the assessee was in lawful right to have received the salary at the place of employment, and it was as a matter of convenience that the salary was thereafter transferred to the Indian account.

In the light of the fact that the salary accrues to India on account of the services rendered outside India and I am assuming that the lawful right to receive the salary in your case arose in Nigeria, the salary earned by you could be considered as not taxable in India. But if you have earned any salary income prior to September 2013 or earned any other taxable income during FY14 in India, it would be taxable. With respect to your residential status on return to India, you may note that you will qualify as a resident of India for income tax purposes if you have stayed in India for 182 days or more during the fiscal or you have stayed in India for 60 days or more in the current financial year and 365 days or more in the preceding four financial years

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Shah Mohammad Abdul Qadir

     PGDM 3sr Semester

IMT college Of Management

    Greater Noida,U.P