Tax implications after r2i - salary paid in US

np_r2i · Post by **np_r2i** » Thu Mar 29, 2007 8:28 am

Hi,

I am planning to return to India at the end of April 2007. I would like some info/advice on tax implications of the move.

Background:
I have been continuously residing in the US since July 1997. My wife has been continuously in the US since August 1995.
Both of us have green card since April 2004. Our 2 kids are US citizens
My company is planning to employ me as an expatriate in India ? so they will continue to pay me a salary in USD in US. this new salary will be half my current salary
I am wondering what the tax implications will be on receiving the salary in USD in US but living and working in India. Will I have to pay tax in the US as well as in India?
My company tells me that it would be the taxes that an expatriate pays - is this correct?

I appreciate any info/tips on this matter.

Thank you in advance

submarine66 · Post by **submarine66** » Thu Mar 29, 2007 9:47 am

Indian taxes will be due on any salary accrued related to work performed in India.

Companies offer senior executives what is termed as "tax equalization benefits". Such benefits will compensate the employee for additional taxes owed to foreign governments over and above what the employee would typically have paid for in the country of origin. Companies would typically pay that additional amount directly to the concerned tax authorities. You should ask your employer whether the package includes this benefit.

regards
Submarine

submarine66 · Post by **submarine66** » Thu Mar 29, 2007 9:56 am

#1 - Please refer to the thread "My silly tax (US/India) related question". Post any further queries in that thread itself rather than proliferating a new thread.

regards
Submarine