Towards a Better ‘Win-Win’… Expats can breathe easier…

Something to cheer-up for those who are working in India and falling into the following categories, viz.,

Ø  a citizen of a foreign state, resident in India, who is an employee of a foreign company or

Ø  a citizen of India, employed by a foreign company outside India, either of who is on deputation to the office /branch/subsidiary/joint venture in India of such foreign company,

may now open, hold and maintain a foreign currency account with a bank outside India and receive the whole salary payable to him/her for the services rendered in such capacity in India, by credit to such account, provided that the income-tax chargeable under the Income-tax Act,1961 is paid on the entire salary as accrued in India.

Similarly, a citizen of a foreign state resident in India, who is in employment with a company incorporated in India may open, hold and maintain a foreign currency account with a bank outside India and remit the whole salary received in India in Indian Rupees, to such account, for the services rendered to the Indian company, provided that the income-tax chargeable under the Income-tax Act, 1961 is paid on the entire salary accrued in India.

This marks a major change from the earlier regulations restricting such remittances to 75% of the salary accrued to or received by such persons in India.