r2i forum

hello all,

So we have finally hit ROR status this year, and we going through the 'scary' process of starting to report all US assets (to be frank, I am just not sure whether to trust IT dept with all this information, but no choice I guess). I got document from the accountant stating to fill out 'Peak Balance' for each account. Earlier this year, I did some moving around of funds between different US accounts with the aim of consolidating some accounts. Due to this peak balance for a number of accounts are quite high, and if all peak balances are added up, the total is many tens of thousands USD more than the actual amount!!

My concern is that next year the peak amounts will be smaller, will I get hassled by IT dept? Has anyone faced such issues? In general, what is the experience when you first become ROR and report all foreign assets (most of my assets are still in US, since we lived there for 15 years)

thanks!

[QUOTE](to be frank, I am just not sure whether to trust IT dept with all this information,

Yes, you really have no choice but how do you think that the deptt. will miss use this info, except hit you with a hefty tax,

About the peak amounts, I have the same issue (not a problem) and I have been reporting for a few years as I started before they made it mandatory. So far we have had no problem and in fact DW has got her just refund for AY15-16 already. To boot our assets were distributed across 3 countries with some movement between the countries as well. But we do have fewer accounts.

dbs;632282Yes, you really have no choice but how do you think that the deptt. will miss use this info, except hit you with a hefty tax,.

I guess OP's fear is IT will pass on the info to D-Gang. Then he will start getting extortion calls.

Does India have a weath tax ? Or, any surcharges on taxes owned by the really rich?

dbs;632282Yes, you really have no choice but how do you think that the deptt. will miss use this info, except hit you with a hefty tax,

About the peak amounts, I have the same issue (not a problem) and I have been reporting for a few years as I started before they made it mandatory. So far we have had no problem and in fact DW has got her just refund for AY15-16 already. To boot our assets were distributed across 3 countries with some movement between the countries as well. But we do have fewer accounts.

Thanks Dbs, this is very helpful to know that the peak amounts did not automatically raise flags. 3 countries, that is an additional level of complexities, I imagine! the one thing i feel bad about is that all the things we do to reduce US taxes basically goes out the window after R2I, since you are going to end up paying 30% overall anyways. I had a really bad taste of this last year, when I sold an flat...no taxes on it in India because I put the gains back into RE, but hefty tax in the US :(

Old-Spice2;632287I guess OP's fear is IT will pass on the info to D-Gang. Then he will start getting extortion calls.

Actually, I'm not as worried about the D-gang, because I don't really have that much to be of interest to them :) What i'm more worried about is that people who follow the rules are the ones who seem to be getting hit with more taxes all the time. Anytime the govt feels like raising more funds, just raise taxes(but they seem to do very little about the fact that only about 3% of the population pays taxes). There is also a lot of knee-jerk reactions to many social issues, which also results on some surcharge or the other. But the real discomfort is that if I get into any kind of trouble, i'm not sure if the IT dept/Govt will try to reach into these funds, either as penalty or punishment. Maybe I'm being paranoid here. Take this Mallya thing, for example. I will readily admit I don't know all the details, but it just seems odd to me that the banks loaned him so much funds without taking adequate precautions. Shouldn't some of those people also be held accountable? We know they will not be. Say I start my own business, and am able to also raise a small amt of funds that gets wiped out, will my personal funds be spared?

Sorry about the rant.

okonomi;632288Does India have a weath tax ? Or, any surcharges on taxes owned by the really rich?

Wealth tax was abolished in 2015. Applies to jewelry and such. Not sure about property taxes. Instead income tax was increased for the highest slabs.

mego2i;632295.... 3 countries, that is an additional level of complexities, I imagine! the one thing i feel bad about is that all the things we do to reduce US taxes basically goes out the window after R2I, ...What i'm more worried about is that people who follow the rules are the ones who seem to be getting hit with more taxes all the time.......

Fortunately :p, I am not a USA related person (that is what the FIs are calling them.) I hardly have any usa income in my name and so do not find it necessary to file tax returns. Any tax deducted, I just write it off. Don't want to tangle with the big guys.

I find the other two countries the UK and India, much more civilised. I really have not been troubled by these guys since 1972 when the guy wanted a Parker pen because I worked with a MNC. I did not get my refund but that was OK too.
In 80s, I was summoned to the IT office 3 years running. Made to sit outside for half a day. Then the ITO looks at the file and says that there is nothing and asks why have I come. On being quizzed whether some one had set me up, he took shelter behind the random selection procedure. But I suspect that the fired CA used his contacts.

If you have nothing to hide BIG then you need not be worried.
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I am thankful that I have to pay taxes because it shows that I have income.

dbs;632302

If you have nothing to hide BIG then you need not be worried.

I am sorry dbs to disagree with you for the sake of information to OP's concern. It is something to worry about and I am aware of people in Delhi, Banglore, Chennai, Hyderabad all have issues in many regards. Of course if the amounts are small, there is less likely for scrutiny, but as amounts increase, tons of unfair scrutiny, we can neither pay bribe or not, always in dilemma do we need big CA's or small ones, etc.

srinpo;632366.... but as amounts increase, tons of unfair scrutiny, we can neither pay bribe or not, always in dilemma do we need big CA's or small ones, etc.

Srinipo, thanks for the info. is this scrutiny only happen for the first year, or do you hear it happening multiple years?

mego2i;632651Srinipo, thanks for the info. is this scrutiny only happen for the first year, or do you hear it happening multiple years?

If you are high income audit will practically happen every year. But issues arises may be for some year. The appeal process is so so slow, it is common for cases in High court to be pending for 7-10 years. May be it is getting better, but the problem is once we get into a issue, it takes huge time (may be even 10 years) to unwind it. Yes, I have personal bitter experience as well and still having.