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How India's new citizenship-based tax impacts Indians living abroad

India has amended the residency rules in the Income-tax Act and introduced citizenship-based taxation effective from April 1, 2020. The amendment was introduced as an anti-abuse provision. Here is how it will impact Indians living in abroad.

Most countries in the world impose personal taxes basis residency or physical presence but there are a few countries where taxation is based on citizenship of the individual. These countries generally tax foreign income of their non-resident citizens, in entirety or in limited situations. The US is a great example of a citizenship-based tax regime. Till FY2019-20,

taxation in India was solely dependent on residency which in-turn was ...

As per the new rule, an Indian citizen with India sourced income (income from a source other than foreign sources) exceeding Rs 15 lakh during the relevant financial year will be deemed to be a resident in India if he/she is not liable to tax in any other country by reason of domicile or residence or any other criteria

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