From the fast-paced cities of Mumbai and Bangalore to the serene beaches of Goa and the cultural charm of Jaipur, India offers expats an exciting and deeply immersive lifestyle.
In this guide, we’ll walk you through everything you need to know about relocating to India from a personal tax perspective, including tax residency, income tax, special tax regimes and tax return obligations.
TaxPilot recommend that you organize your affairs in good time to get ahead and make the most of favorable tax treatment while making sure you’re meeting your tax return obligations.
India follows a residence taxation model. If you are resident, you will pay tax worldwide incomes. If you are non-resident, you will pay tax on local incomes only.
if you spend more than 181 days in India during the tax year.
if you are present in India on more than 59 days during tax year and 365 days in the previous four tax years.
Providing that you are considered not ordinarily resident, foreign incomes and gains will be exempt from Indian taxation. India can be a very tax efficient place to live for expats and nomads and as such, Global Tax Consulting recommends seeking personalized tax planning advice to take advantage of the special tax regime.
Exempt from Indian taxation.
Must be not ordinarily resident.
Tax on property and share sales
Tax on value of owned assets
Tax on assets passed to heirs
Tax to contribute to state welfare
If you receive incomes overseas while you are living in India, you may find the source country, as a starting point, continues to tax the income which may cause double taxation unless you are using special tax regime.
Double taxation agreements can be used to mitigate double taxation and receive tax free income. As such, the more double taxation agreements a country has, the better, as agreements will ensure you’re not taxed twice and even better, ensure your income is tax free.
At present, India has 94 double taxation agreements signed.
