Indians working in UK: Per diem paid by Indian company may be tax-free in India if these conditions are met
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- ✓Indians working in the UK may get tax-free per diem payments from Indian employers under specific conditions.
- ✓A recent ITAT Delhi case showed that taxability depends on residential status and the India-UK DTAA.
- ✓CA Suresh Surnana said, "remuneration or per-diem relatable to such UK employment should be taxable in the UK."
Story at a Glance
- Category
- BUSINESS
- Reported By
- Economic Times
- Reading Speed
- 6 Minute(s)
- Market Focus
- India Economy
Indians working in the UK may receive per diem payments from their Indian employers. However, these payments are generally taxable in the UK and not in India under specific conditions. The taxability in India depends on the employee's residential status and where the employment is exercised. A recent ITAT Delhi case illustrates the application of the India-UK DTAA in determining taxability.
If you are an Indian employee sent to work in the United Kingdom and receiving per diem payments (for living expenses and incidental costs) from your Indian employer, those payments are usually taxable in the UK under the India-UK DTAA unless specific conditions apply. The taxability of these per diem payments in the UK can vary based on several factors. However, from India perspective, they are usually not taxable if certain conditions are met under the India-UK DTAA.
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