Foreign income earned and converted in different FY

[Shikha Mahawar]

Dear Sir/Madam,

I have a query related to taxation on foreign income if earned and converted in two different FY.

If an individual has been out of India for employment purpose for 187 days in a FY, the status of individual turns to NRI. The salary income earned by that individual for that FY becomes exempt from tax.

But what if the individual carries some amount of salary received in foreign currency itself and do not convert to INR and converts the same in INR in next FY when the individual status will be Resident.

Will that foreign currency converted to INR in next FY becomes taxable in that FY although the income earned outside India when the individual was NRI.

Thanks,

Shikha Mahawar

AI Summary

Tax residency: whether converting foreign salary after return makes that earlier-earned income taxable upon conversion. Query on whether salary earned abroad while non-resident and retained in foreign currency becomes taxable when converted to INR in a later year after the individual becomes resident, raising whether tax liability follows the year of earning or the year of conversion/receipt in India given the change in residential status.