CBDT notifies foreign tax credit rules

NEW DELHI: To provide relief to corporates with income abroad, the tax department has notified ‘Foreign Tax Credit’ rules allowing companies to claim credit for

NEW DELHI: To provide relief to corporates with income abroad, the tax department has notified ‘Foreign Tax Credit’ rules allowing companies to claim credit for taxes, surcharge and cess paid overseas. The rules, which come into effect from April 1, 2017, allow taxpayers to claim credit of foreign tax under dispute once it is finally settled. Foreign tax credit (FTC) will be available against tax, surcharge and cess payable under the Act, including minimum alternate tax (MAT) but not in respect of interest, fee or penalty. The rules also provide that disputed foreign tax will be allowed as credit for the year in which the income is taxed in India, subject to certain conditions.

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