This tax hack will save you thousands of rupees of taxes every year!
If you’re an Indian resident who earns income from foreign sources, you may be familiar with the headache of double taxation.
You know, the situation where you have to pay tax in both India and the country where you earned the income.
This can eat up a big chunk of your hard-earned money and leave you with less to invest, save, or spend.
But what if I told you there’s a way to avoid this problem and save thousands of rupees in taxes every year?
Sounds too good to be true, right?
Well, it’s not.
It’s possible with a TRC or a Tax Residency Certificate.
A TRC is a document that proves that you are a resident of India for tax purposes and that you are eligible to claim the benefits of the Double Taxation Avoidance Agreement (DTAA) between India and the other country.
A DTAA is a treaty that India has signed with many countries to prevent double taxation and promote economic cooperation.
It specifies the tax rates and exemptions for different types of income, such as salary, and interest, dividends, royalties, etc.
By having a TRC, you can reduce or eliminate the tax liability in the foreign country, and pay only the tax that is due in India.
This can save you a lot of money and hassle in the long run.
But how do you get a TRC?
It’s not as complicated as you might think.
You just need to apply to the Income Tax Department of India with the following documents:
๐ A duly filled and signed Form 10FA
๐ A copy of your passport
๐ A copy of your visa or work permit
๐ A copy of your tax return or proof of income in the foreign country
The Income Tax department will issue you a TRC within 15 days of receiving your application.
You can then submit the TRC to the tax authorities of the foreign country and claim the benefits of the DTAA.
That’s it.
You’re done.
You’ve just saved yourself from double taxation and increased your net income.
