Indian Finance Minister presented budget in the parliament yesterday. Along with many proposals that may affect international investors, he proposed some significant changes for the Indian residents owning foreign assets as well – reminds us of US style reporting requirements!
Accordingly, a resident taxpayer, who has any asset (including financial interest in any entity) located outside India or has signing authority in any account located outside India, is required to furnish a return of income. This amendment is proposed to be effective from FY 2011-12.
- In case of taxpayers having asset outside India, the existing time limit of four and six years for reopening assessment (where income has escaped assessment) has been increased to 16 years.
- In case of a person who is treated as an agent of the Non Resident, the time limit for issuing reassessment notice has been extended to six years from two years.
- The time limit for completion of assessment and reassessment is extended by three months.