12/04/2017
No Income Tax for Seafarers on NRE Account.
Clarifciation received from Income Tax Department, Ministry of Finance, New Delhi (Copy Enclosed)
*Income tax Circular no. 13/2017 attached below
12Apr1711:51 p.1
F.No:500l07/2017-FT&TR-V
Government ofIndia
Ministry of Finance
Department ofRevenue
Central BoardofDirect TaxesForeign Tax &TaxResearch-II
FTaTR-V Division
Circular No,13/2017
New Delhi;, dated 11. 04.2017
Subject: Clarification regarding liability to income-tax in India for a non-resident seafarer receiving remuneration in NRE(Non Resident External) accountmaintained with an Indian Bank.
Representations havebeenreceived in the Boardthat income byway of salary, received by non- resident seafarers, for services rendered outside Indiaon-board foreign ships, arebeing subjected totax inIndiafor the reasonthat thesalary hasbeenreceived by the seafarer into theNREbank accountmaintained inIndiabytheseafarer.
Z_ Thematter hasbeenexamined intheBoard Section 5(2)(a)ofthe Income-tax Act provides that only suchincome ofa non-resident shall be subjected to tax inIndia that iseither received or isdeemed to bereceived in India. It ishereby clarified that salary accrued to a non-resident seafarer for services rendered outside India onaforeign shipshalt not be included in the total
Income merely because the said salary has been credited in the NRE account maintained with an Indian bank by the seafarer.
(Subhash Jangala)
UnderSecretary (FT&TR-V)
To
(a) Chalrrnan.Membersandall otherOfficers oftheCentral BoardofDirect Taxes.
(b) Pro (CITIPr.DGIT /(CIT/OGIT with a request to circulate the sameamongst all Officers in their RegionICharge.
(c) Commissioner (MediaEt Technical Policy)and Official Spokesperson, CBDT.
(d)AddlDirector General of lncorne-tax (PR,PP&.()L) Ie) ITCCSectionof(BDT(3copies)
(f) ADG(Systems)-.V foruploading ontheDepartmental website. (g} Database[ell foruploading on the IR~Officerswebsite.
(h) Hindicell ofDepartment ofRevenue,for Hinditranslation.
(i) GuardFile.
(Subhash Jangala)
UnderSecretary (FT&TR-V)
