If you are a non-resident Indian with investments in equity and hedge fund in India, and were asked to disclose your overseas (outside India) bank accounts, you don’t have to do it, India’s Central Board of Direct Taxes has clarified.
The CBDT said on Monday those NRIs not seeking tax refund don’t have to supply details of their bank accounts in other countries.
"It is not mandatory. It is optional. It is for cases where a refund is sought," news agency PTI quoted the CBDT Chairman Sushil Chandra as saying.
The tax department has issued this clarification amid confusion among NRIs about this new requirement.
Many non-resident Indians across the world were asked to submit the details of their overseas bank accounts as the deadline for filing tax returns, ie July 31st is approaching.
"This new requirement is not only extra but also devoid of any statutory provision. A compliance measure which does not have any logical explanation would not only lead to compliance indiscipline but would also discourage foreign investments into the country,” tax practitioner Bijal Ajinkya told the Times of India.
Though bank details of an income tax assessee are required in order to process the income tax refund, a new Income Tax Return form introduced in March this year has a new column seeking details of all foreign bank accounts held by the assessee.
Any Indian citizen who has temporarily migrated to another country for six months or more for employment, residence, education or for another purpose is considered a non-resident Indian. Income earned overseas by such a person cannot be taxed in India.
