Foreign tax credit must be limited to the lower applicable tax rate and capped against Indian tax liability. An Indian resident assessee may claim a foreign tax credit for tax paid abroad: under a treaty, in accordance with that agreement; for non treaty foreign tax, credit is limited to the lower of the Indian tax rate and the foreign rate (or the Indian rate if equal). The credit cannot exceed Indian tax payable on the foreign sourced income or on total income. The Central Government may prescribe computation methods, claiming procedures, and other necessary particulars.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Foreign tax credit must be limited to the lower applicable tax rate and capped against Indian tax liability.
An Indian resident assessee may claim a foreign tax credit for tax paid abroad: under a treaty, in accordance with that agreement; for non treaty foreign tax, credit is limited to the lower of the Indian tax rate and the foreign rate (or the Indian rate if equal). The credit cannot exceed Indian tax payable on the foreign sourced income or on total income. The Central Government may prescribe computation methods, claiming procedures, and other necessary particulars.
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