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Posted Fri, 09 Feb 2024 19:08:59 GMT by
I am a UK citizen, living and working in the UK for the last 25 years. Recently, I have become an employee of a company in India. THis company has no business or presence in the UK. I work remotely from my home in UK for the company . I receive a monthly salary from my employer in India into my Indian NR (Non Resident) Bank account . I do not repatriate the money to the UK. My employer in India deducts income tax to the full extent as per India's tax slabs from my monthly income. THis comes to around 30% on my income. The CAs and my employer are pretty clear there that Income tax to the full extent will be deducted in India. How do I claim relief in the UK under the DTAA with India? I understand that this is covered under Article 24 (Dependant Personal Services) of the DTAA with India. Am I able to claim full relief of the 30% tax withheld in India on my salary? If yes, which field in the Self Assessment form do I claim this in?
Posted Wed, 14 Feb 2024 10:20:33 GMT by HMRC Admin 25
Hi mathoo,
As UK resident and domicile, you will declare this as self employment on your tax return.
You will also show it on the foreign section of the tax return in order to claim Foreign Tax Credit Relief for the tax paid.
This relief cannot exceed the UK tax that is due on the same source of income and as such, the full 30% is not allowed.
You would therefore need to claim any excess back from the Indian tax authorities.
Thank you. 

Posted Thu, 14 Mar 2024 11:13:26 GMT by Ravi Mathoo
Thank you for the response. As a follow up query, if I am a highest rate tax payer in the UK, what is the maximum tax relief I will be able to claim in the UK on the 30% tax deducted in India? You mention that the full 30% will not be available. How much relief is available in the UK on such employment income?
Posted Wed, 20 Mar 2024 14:27:26 GMT by HMRC Admin 25
Hi rmathoo,
It depends on the actual UK tax that would be due on your income.
You cannot claim more Foreign Tax Credit Relief than what is the UK equivelant.
Thank you. 


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