Want to calculate tax on income earned outside India? Keep these factors in mind

Working from home has reduced the necessity for physical presence in a lot of companies around the globe. Nowadays, an individual can accept assignments in the form of overseas jobs, where salary or fees are paid from outside India for services performed from India. People can become confused about the taxes to be levied on money received from outside of India in certain circumstances. Income earned outside of India is similarly taxable to income earned within the country. However, because the source of the revenue is in another nation, there is a chance that the income may also be liable to taxation in that nation. Here we will discuss how people with foreign jobs can calculate their net income, keep adequate records of their money, and make informed decisions about their finances: Learn about the applicable TDS of that particular country: Similar to TDS in our country, a foreign government may similarly withhold tax when transferring money to India. Thus, before engaging in a service agreement, an individual must be aware of the withholding rate that will be applied to their income from sources outside the country. For instance, a US firm may deduct a specific percentage from payments sent to an Indian service provider in accordance with American laws. The withholding rate could range from 10 percent to 20 percent, depending on the type of service. Relief for persons who have paid foreign taxes: Residents who have paid taxes in another country are offered relief under income tax laws. This indicates that akin to requesting TDS credit, credit for taxes withheld in a foreign country can also be claimed in India. While this relief can help the taxpayer pay less tax in India, preventing double taxation of the same income, the taxpayer cannot get a reimbursement for any additional taxes paid abroad. Conversion into Indian rupees for tax purposes: The exchange rate used to convert foreign currency income to Indian rupees for tax purposes is specified by income-tax regulations. Different dates have been set depending on the type of income. For instance, the taxpayer must use the SBI TT purchasing rate on the day the payment is due or is paid in advance for salary income, and for professional fees, on the last day of the month immediately before the month in which the income accrues. Read all the Latest News , Trending News ,  Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.