Deemed income: amendment treats tax deducted and creditable foreign tax paid by deduction as income received.

The amendment to section 198 provides that amounts deducted under Chapter XVII-B and income tax paid outside India by way of deduction, in respect of which an assessee is allowed a credit against tax payable under the Act, shall be deemed to be income received for computing the assessee's income. The change aligns domestic withholding and creditable foreign tax paid by deduction within the scope of sums treated as income and takes effect from 1 April 2025.

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