CBDT extends relief from double taxation worries to NRIs stranded by pandemic

NEW DELHI:  Providing substantial relief to Non-resident Indians (NRIs) who were facing the prospect of double taxation due to being unable to leave the country during the Covid-19 pandemic, the Central Board of Direct Taxes (CBDT) has now said that if any individual is facing double taxation despite the relief provided in the relevant agreements, then such individuals may provide the tax department the necessary information by March 31, 2021.

“Circular No. 2 of 2021 has... provided that if any individual is facing double taxation even after taking into account the relief provided by the relevant Double Taxation Avoidance Agreement (DTAA), he/she may furnish the specified information by 31st March, 2021 in Form –NR annexed to the said Circular,” a statement by the Union finance ministry said. 

The Central Board of Direct Taxes (CBDT) had recently received various representations from across the country requesting a relaxation in the guidelines determining residential status for the fiscal year 2020-21.

Under Indian laws, if an individual is resident in the country for a certain amount of time, then they would be liable to  certain levels of taxation.

 However, according to the representations, many NRI individuals who had come on a visit to India during the previous year 2019-20 and intended to leave India but could not do so due to the suspension of international flights.

Officials said that the matter has since been examined by direct tax board. 

According to the statement, the direct tax board will consider providing such individuals either a general relaxation or specific relaxation in individual cases depending on the information that is provided to it.