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I am a citizen of India, currently working as a software engineer in India. Thus I am paying income-tax to Indian-Govt. I am moving to US in November-2014 on L1-Visa. I had following questions in respect to tax implications which I would have to deal with after moving to US :

  1. I will have to pay the tax to Indian-Govt. on the income which I have earned in India from April-2014 to October-2014. So, if my income for these 7-months is 2.4L, would I have to pay any tax to Indian-Govt. as this income comes under the tax-free cap of 2.5L annually?

  2. I have a normal savings-bank-account with HDFC in India. After I move to US, and if I wire-transfer my earnings in US into this HDFC-bank account, would these deposits be considered as taxable-income for me in India, and so, would I have to pay taxes on these deposits in India?

  3. Also, if I transfer my earnings in US into my parents' account in India (which is also a regular saving-bank-account), do my parents(who hold a Permanent-Account-Number which is linked to their bank-acount) have to pay any taxes in India?

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I will have to pay the tax to Indian-Govt. on ...

Yes that is right, as the income is 2.4 lacs, there is no tax. Please note that the exact date when you go to US matters. For the financial year April 2014 to March 2015, if you spend less than 182 out of India; you would still be resident of India. The income you earn in US will also be taxable in India. There is dual tax avoidance and you can claim relief. It is irrelevant if you transfer the funds to India or keep them in US, your earning would be taxed.

if I wire-transfer my earnings in US i ...

See point above, any transfer of funds into your India is not taxable. It is advisable to open an NRO/NRE account to make things easier.

if I transfer my earnings in US into my parents' account in India ...

This transaction would be treated as a GIFT from you to your parents. As per Gift tax, there is not tax obligation as you are transferring to your parents.

Edit:
If you stay more than 182 days in India you are treated as Resident and taxed on Global Income. If you stay less than 182 days in India you are treated Non-Resident and taxed only on earnings in India.

  • A bit unclear on what you mean by - The income you earn in US will also be taxable in India. There is dual tax avoidance and you can claim relief. It is irrelevant if you transfer the funds to India or keep them in US, your earning would be taxed Is this applicable only when you stay < 182 days in India ? – R11G Feb 28 '15 at 5:28
  • @R11G : Edited the answer, if you spend less than 182 days out of India you Resident for taxes purpose. – Dheer Feb 28 '15 at 13:00

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