Income Tax consequences

POSTED BY amar ante ON June 14, 2012 11:05 am COMMENTS (2)

My nephew has been sent for training in China by his employer for a short period of 2 and half months. He receives daily allowance in Dollars and now want to send maney to India. What is the limit for such transfer to his 1) own savings accounts ii) father’s/uncle’s savings accounts? How to bring these dollars with mimimum income tax? please reply. Thanks.

2 replies on this article “Income Tax consequences”

  1. Dear Amar, The tax rate ‘ll be the slab rate for your Son. By the way, the amount may be tax free if it is not ‘Per Diem’.



  2. BanyanFA says:

    Based upon my understanding, the allowance which you are mentioning is ‘Per Diem’. Any unspent Per Diem which is remitted back to India is liable to tax. Hence, if you spend your entire Per Diem outside India – no tax is levied in India.

    Considering your nephew was sent for a couple of months, he would not be treated as NRI in India. Hence he can remit any amount of funds to his Indian saving bank account. But you must be aware that any amount credited in his saving account is liable to tax (as mentioned in 1st para). If he sends any funds to his father’s account, he would still be liable to pay tax – though the father would be exempt considering it is a gift from son.

    If he sends it to his uncle’s account, both he and his uncle would have to pay tax. He would pay tax on amount remitted. Uncle would have to pay tax as an income received from his nephew.


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