Income earned from abroad

[Joe Kurian]

Dear Sir,

I am a resident Indian running a sole proprietorship firm with a current account. I concentrate in facilitating international trade, goods from Europe to China, and get commissions from my Chinese buyers. Do advise whether I have to pay income tax in India. Again, do also advise if I invest the money here, will I get tax exemptions. Buying land or developing land etc.

AI Summary

Resident Indian Trader Must Pay Tax on Foreign Earnings, Can Claim Credit Under Sections 90 or 91 of Income Tax Act. A resident Indian operating a sole proprietorship in international trade seeks advice on tax obligations for commissions earned from Chinese buyers. They inquire about potential tax exemptions if investing this income in India, such as through land purchases or development. A chartered accountant responds, stating that as a resident, the individual is liable to pay income tax on both domestic and foreign earnings. However, they may claim credit for taxes paid abroad under Sections 90 or 91 of the Income Tax Act, 1961.