Foreign Tax Credit: Overview and Related issues

The era of globalization and digitalization has brought a revolution in the way businesses are conducted, bringing the economies/geographies closer. While the businesses are evolving, the tax challenges relating to the right to tax the income between the Source and Residence Country are equally evolving.

Tax Treaties play a very crucial role to ensure that the taxes on income are distributed between the sovereigns while eliminating/ minimizing double taxation in the hands of the person earning the income. In this article, we are giving an overview of the regulations relating to the claim of Foreign Tax Credit (FTC) in India and the related tax issues.