salary of NRI for services rendered outof india is credited in NRE a\c in india directly by employer is taxabl

Question

person in NRI ,his salary for sevices rendered outside india is given in india directly by employer. it is credited directly in his NRE a\c .is ths salary will be taxable in india?

Answer 1

It depends whether the company who made the NRI employee is Indian or Not. In a very recent judgment by Authority on Advance Ruling, it was decided that in case of an NRI who gave the service outside India and received salary outside for an Indian Company, Salary is taxable because that NRI worked as an agent of the Indian Company.
Read below for complete knowledege
Section 5 (2) of the I T Act says:
" Subject to the provisions of this Act, the total income of any previous year of a person who is a non-resident includes all income from whatever source derived which-

(a) is received or is deemed to be received in India in such year by or on behalf of such person; or

(b) accrues or arises or is deemed to accrue or arise to him in India during such year."

So income of your husband ,who is Non Resident ,shall be taxable in india in following cases :

( i )Income is received in India
(ii)Income is deemed to be received in India
(iii)Income is deemed to accrue or arise in India.
I think the new decision is against you otherwise, the salary should not be taxable if the service is given outside and also not received in India.

Answer 2

If your income is expended in India then it is taxable in India
If it is directly reimbursed in india by your employer