Scrutiny assessment for AY 2013-14 U/s. 143(3) of the Income Tax Act 1961 (International Taxation)

[Nik Shing]

I worked in the UK during 2012-13 for my company for 9 months. And they had paid my Income tax in UK (HRMS). l have a P60 form from my company which proves the income tax is paid in UK.

PwC had filed the income tax return with Income Tax dept. India (In Sep 2013) In which we have claimed a relief u/s.90/91 of the I.T. Act 1961 and claimed refund of the tax I had paid in India.

This was a substantial amount which I received subsequently.

After that in 2015, I received a scrutiny notice for AY 2013-14 from I.T. Dept. India. As a part of this scrutiny the I-T officer have demanded the 'Residency Certificate (RC)' of UK in order to claim the relief u/s.90/91(Subsection 4). I had submitted all the proofs (i.e. P60 etc) to the I-T Officer.

As per the I-T office, I cannot claim the relief without RC and will have to pay back all the Taxes and penalties.

I then contacted the UK Tax dept. (HRMS) and requested the 'Residency Certificate', but I was informed that because I worked in the UK for less than 52 weeks hence there is no National Insurance Number or Self-Assessment number generated for me. Hence ‘Residency certificate' cannot be issued for me

So my question is,

1. As per I.T. Act 1961-2015 Section 90/90A/91 (subsection4) it is required to present a 'Residency Certificate (RC)' of the country in which you worked, but what if that country

Cannot provide the RC due to their own rules/regulation. i.e. in my case UK cannot provide it. Is there any alternative to this rule.

2. A number of Indians work in UK on short term ICT 2 visa, which is only valid for 1 year. And UK do not issue 'Residency Certificate' if you work less than 52 weeks. That means technically none of the short term ICT 2 visa Indian worker will get the UK RC. And will have to pay taxes in both UK & India? This s clear case of double taxation?

3. Is there any expert advice you can give to deal with this problem.

AI Summary

Individual Challenges India's Tax Scrutiny for 2013-14; Seeks Alternatives to UK Residency Certificate for Tax Relief An individual who worked in the UK for nine months during 2012-13 and paid UK taxes received a scrutiny notice from the Indian Income Tax Department for the assessment year 2013-14. The individual claimed tax relief under sections 90/91 of the Indian Income Tax Act, supported by a P60 form, but was asked to provide a UK Residency Certificate (RC), which could not be issued due to UK regulations. The individual seeks advice on alternatives to the RC requirement, highlighting the issue of potential double taxation for short-term UK workers on ICT 2 visas.