Mr. Varun, an Indian citizen aged 44 years, left India for the first time on 1st April 2022 to settle in Country 'B'. But owing to some personal…

Mr. Varun is a resident in India for A.Y.2025-26, since his stay in India in the P.Y.2024-25 is for 304 days which exceeds the minimum required stay of 182 days in that previous year. Also, his stay in India must be more than 730 days in the immediately preceding seven years, and he must be resident in 8 years (P.Y. 2014-15-to P.Y.2021-22) out of 10 years immediately preceding P.Y. 2024-25, since he left India for the first time on 1st April, 2022. Hence, he is resident and ordinarily resident in India for A.Y.2025-26. Accordingly, his global income would be subject to tax. He would, however, be entitled for deduction under section 91 in respect of doubly taxed income earned in Country 'B'. Computation of total income of Mr. Varun for A.Y.2025-26 Particulars Particulars ₹ Income from House Property [Residential property in Country 'B'] Annual Value ($48,000 x 86, exchange rate on 31.3.2025, being the rate on the last day of the P.Y. as per Rule 115) 41,28,000 Less: Deduction under section 24 - 30% of NAV 12,38,400 28,89,600 Profits and Gains of Business or Profession Income from business in India 9,40,000 Income from Other Sources Dividend from Indian company [₹ 3,37,500 x 100/90] 3,75,000 Interest on savings bank account with PNB 19,800 3,94,800 Gross Total Income 42,24,400 Less: Deduction under Chapter VIA Under section 80TTA (Not available under default tax regime as per 115BAC) NIL Total Income 42,24,400 Computation of net tax liability of Mr. Varun for A.Y.2025-26 Particulars ₹ Tax on total income [30% of 27,24,400 +1,40,000] 9,57,320 Add: Health and Education cess@4% 38,293 9,95,613 Less: Deduction under section 91 (See Working Note below) 3,97,320 Net Tax Liability 5,98,293 Net Tax liability (Rounded off) 5,98,290 Working Note: Calculation of deduction under section 91 Particulars Particulars ₹ Average rate of tax in India [i.e.,9,95,613/42,24,400x100] 23.57% Average rate of tax in country 'B' [20% of $ 33,000 ($ 48,000 - $ 15,000) = $ 6,600; $ 6600/$ 48,000 x 100 = 13.75%] 13.75% Doubly taxed income Income from house property 28,89,600 Deduction u/s 91 on 28,89,600 @13.75% (being the lower of average Indian tax rate (23.57%) and foreign tax rate (13.75%)] 3,97,320