The unprecedented lockdown and travel restrictions brought on by Covid-19 forced many NRIs to overstay their visit in 2020. This in turn not only impacted their residential status but also their tax liability. If you’re amongst the people who are in a dilemma, this article can help clear doubts regarding your residential status. It also spells out the vital exemptions offered by the CBDT for FY 2019-20 and various factors to consider so as to take advantage of Double Taxation Avoidance Agreements (DTAAs).
The past year and a half have been anything but ordinary. From the way we interact with each other to the way we invest, most things have changed significantly. And taxation is no different. This is particularly true for non-resident Indians (NRIs), who now find themselves facing a dilemma with regard to their residential status.
Unexpected travel restrictions and lockdowns in 2020 meant that NRIs visiting family in India had to stay back in the county longer than they had planned. As a result, there’s one question asked by every NRI who couldn’t leave India amid the pandemic: What would my residential status be during the pandemic year(s)?
This question is crucial for NRIs because their residential status influences how they are taxed during the years concerned. Being a ...