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My friend is planning to invest in India. So if he transfers around 150000$ to my account..

  1. How much tax do I have to pay?
  2. Is there any way to show it as foreign investment?
  3. Can I include my friend's(Not Indian) name as an investor in legal documents?

I completely have no idea about this so any help would be appreciated.

  • You kidding me dude !! First your bank will raise hell, as to how you got so much money. They will want evidence that it isn't ill gotten wealth. And why does he need to transfer the whole amount at once. Ask your bank. As this isn't a gift, you will have to pay tax. – DumbCoder Sep 18 '14 at 8:17
  • Thanks DumbCoder!! Dude.. If you read my question carefully it clearly says that how much tax I should pay, so its very obvious that bank will question, so I want to know what are the tax laws. – user3170565 Sep 20 '14 at 12:09
  • No need to be a smart ass. You clearly didn't understand what I mentioned. You just assumed it. Bank will never ask about tax. They will ask about the source of money. Next time try to read and understand before using the keyboard. – DumbCoder Sep 21 '14 at 15:25
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    I never said Bank will ask about tax. You just assumed it. Peace Man!! It's a forum for sharing knowledge. No need for arguments. I didn't mean to offend you any how. Again thanks for replying. – user3170565 Sep 22 '14 at 1:12
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How much tax do I have to pay?

This would be treated as Gift and taxed accordingly to the tax bracket.

Is there any way to show it as foreign investment?

What do you mean by this? There is no such thing. Do not mix it up with investments by Companies for various purposes

Can I include my friend's(Not Indian) name as an investor in legal documents?

Which legal documents?

Apart from this, how are you planning to send back the funds to your funds? Rupee is not convertible on capital account. It maybe quite a bit of time to move the funds out and depends on regulation.

Edit To respond to OP's comment
Create a company and have your friend as a partner. Consult a CA as well as a Lawyer as there are several rules and regulations in place that must be followed.

  • Thanks Dheer for your valuable comments. 1) So will it be added to my annual income and I have to pay taxes accordingly? 2) I was wondering that like companies invest, same way an individual can also invest. 3) I think this is also not possible. We are planning to open a restaurant so property related documents, some legal agreement like what will be share of each partner. – user3170565 Sep 20 '14 at 12:32
  • We are not looking to move out funds as of now. Is there any way I can save some tax? – user3170565 Sep 20 '14 at 13:16

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