French/US citizen living in India

[Guest]

Hi,

I am a French citizen, tax resident is US (I am working is US since 2 years). I have been sent by my company in India for a 6 months work period. I am about to be paid dividends from France and wages from US.

I have read on a French website that these dividends would not be taxable in india since I am not considered as an indian tax resident. https://avocatdroitfiscal.paris/fiscalite-internationale

Do you think I am taxable in India?

Thanks,

Regards,

[Nandan Khambete]

Hi,

Before determining taxability of Income , it is important to determine your Residential Status as per Section 6 of Income Tax Act, 1961.

You are considered an Indian resident for a financial year :

• When you are in India for at least 6 months (182 days to be exact) during the financial year

OR

• You are in India for 2 months (60 days) for the year in the previous year and have lived for one whole year (365 days) in the last four years.

If your status is ‘resident,’ your global income is taxable in India. If your status is ‘NRI,’ your income which is earned or accrued in India is taxable in India.

Even in case you are Indian Resident in Financial Year 2017-18 and if Dividends are taxable , you can claim relief under India France DTAA of taxes paid in France on such dividends by filing Income Tax Return in India.

Regards,

CA Nandan Khambete

[Guest]

Many thanks for your quick and very detailed answer!

AI Summary

Residential status determines Indian tax liability; nonresidents taxed on India sourced income while residents face worldwide taxation. Residential status under Indian tax law determines taxability: residents are taxable on worldwide income while nonresidents are taxable only on income earned or accrued in India. Foreign dividends and wages are taxable in India only if the taxpayer qualifies as resident; otherwise only India sourced income is taxed. Taxpayers may claim relief under the India-France double taxation arrangement for dividends taxed in France by filing an Indian return and claiming credit for foreign tax paid.