I was working with an Indian company till mid of 2014, all my taxes were adjusted and final settlement paid to me, and then I was without a job until end of Jan. I moved to Singapore for a short term contract in Feb and will be here for a few months only, so I wouldn't qualify for NRI status this financial year nor next year either. I have been told that since I am in Singapore only for a short term I have to pay 15 % tax to the Govt here. I have an NRE account in India where I plan to move my savings from here. Do I have to pay the 20-30 % tax on my full salary amount here in India again? Do I have to only pay when I transfer money there or starting now itself and is there any deductions I can claim like we have rent and medical etc in India?
1 Answer
Yes, as you are Indian resident for Tax purposes, you have to pay Tax in India for the amount you have earned in Singapore.
So essentially add the income from 1st April to Mid 2014 with the eq SGD earned in Singapore till 31st March 2015. Apply the tax brackets like you normally do, claim the exemptions you would normally do 80 C etc. As India and Singapore has a Dual Tax Avoidance Treaty, you can claim the portion the tax already paid in Singapore and pay only the balance. For example if the tax works out to be Rs 30, you have already paid Rs 20 in Singapore, you would have to pay only Rs 10 in India and mention that you have already paid Rs 20 to Singapore IRS.
It is irrelevant whether you transfer the funds to India or not, the tax is applicable in the financial year you have earned.
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