Tax relief on USA Retirement Benefit Account - u/s 89A r.w.s rule 21AAA

[PRIYAM KHAMBHATA]

Respected Sir

My client is citizen of USA since long, but his residential status became Resident of India, from AY 2019-20. He is maintaining Foreign Retirement Benefit Account - 401K account, IRA Account. As per the new provisions inserted from 01.04.2022 in respect of Tax Relief u/s. 89A read with rule 21AAA, he has to exercise option, foreign income reporting at the time of receipt, not at the time of accrued and to file Form 10EE online. But, my client has missed out file Form 10EE from AY 2023-24 and not to report foreign income on such foreign retirement benefit accounts in the Return of Income filed for AY 2022-23 to 2024-25.

Now, what are the consequences arise, if he file Form 10EE as per the rule 21AAA for the AY 2025-26, or otherwise he will not file Form 10EE and Foreign Income will report in ITR when he receives.

Should he report foreign retirement accounts in Foreign Asset Disclosure - Schedule FA in ITR ?

Please guide me.

Thanks

AI Summary

Late or Non-Filing of Form 10EE and Reporting Foreign Retirement Income Under Section 89A and Rule 21AAA A US citizen who became a resident of India from AY 2019-20 holds foreign retirement accounts including 401K and IRA. Under the provisions effective from 01.04.2022, tax relief under section 89A read with rule 21AAA requires reporting foreign income at the time of receipt and filing Form 10EE online. The client failed to file Form 10EE for AY 2023-24 and did not report foreign income from these accounts in returns for AY 2022-23 to 2024-25. The query concerns the consequences of filing Form 10EE belatedly for AY 2025-26 or not filing it at all, and whether foreign retirement accounts should be disclosed under Schedule FA in the income tax return. The issue involves compliance with foreign income reporting and tax relief claim procedures under Indian tax law for foreign retirement benefits.