Representative AI image (Pic credit: Canva) MUMBAI: The income tax appellate tribunal (ITAT) recently ruled that income earned in the US would be taxable for an individual residing in India. While the individual initially declared an income of Rs 9,570 for 2012-13, his taxable income surged to Rs 43.5 lakh after the US income was added.
Under tax laws, residential status determines tax liability. Non-residents, for example, are not taxed in India on foreign income. However, in this case, the individual was a tax resident of both India and the US, requiring the application of the 'tie-breaker test' under the India-US tax treaty to determine which country he was a resident of.
Applying this test, which takes into account certain criteria, ITAT concluded that the individual's "centre of vital interest" was closer to India, making his US income taxable in India. Haryana Jammu & Kashmir Haryana Alliance View i Party View Seats: 90 Results Majority: 46 BJP 48 CONG 37 INLD 2 AAP 0 OTH 3 Results : 90 / 90 BJP WON Jammu & Kashmir Alliance View i Party View Seats: 90 Results Majority: 46 JKNC 42 BJP 29 CONG 6 PDP 3 OTH 10 Results : 90 / 90 HUNG ASSEMBLY Source: PValue.
