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My brother is considering to bring USDs from Saudi and get them converted here. He's had trouble remitting through banks since he doesn't have iqama at the moment. So, if we get $s converted in India, will that be taxable?

I know that he'll need to declare it to customs if he brings more than $5000. Just unclear on the taxability.

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Taxability depends on residential status when the $ were earned. If it was earned during his status as "Non-Resident" in India, then its tax free.

If the money was earned when his tax status was resident in India, then its taxable as per the tax bracket.

Edit:
Taxability does not depend on whether to transfer the money into India, or keep it out of India or bring it as Cash or Electronically. It only depends on NRI status. Of course transferring the funds into NRE makes the paperwork simpler in case there is a scrutiny.

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  • he will b an NRI after another 4 months... so for the year Apr-Mar2016, he'll b NRI for the financial year..... so am assuming the earnings during that period will b tax free... What do u think? – Mohneesh Suri Jun 13 '15 at 8:52
  • If hes stayed / will be staying more than 182 days outside India, he would be NRI and his earnings outside India would be tax free in India. – Dheer Jun 13 '15 at 12:29
  • thats what i hv been thinking... so logically whether u remit or bring in $$$, it shdnt b taxable... my CA wasn't sure, probably coz he doesn't encounter this situation often... Thanks for the help Dheer! – Mohneesh Suri Jun 13 '15 at 12:31

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