Form 67 – Claiming Foreign Tax Credit (FTC) for FY 2023-24

📢 For individuals and businesses earning foreign income, claiming Foreign Tax Credit (FTC) is essential to avoid double taxation. Form 67 is a mandatory document for taxpayers who wish to claim credit for foreign taxes paid on income earned outside India.

📌 Due Date: 31st March 2025 (for FY 2023-24)
📌 Applicable for: Individuals, businesses, and entities with foreign income taxed both in India and abroad.

Filing Form 67 is necessary to offset foreign tax paid against Indian tax liability, ensuring fair taxation and compliance with global tax laws.

What is Foreign Tax Credit (FTC)?

Foreign Tax Credit (FTC) allows Indian residents to claim credit for taxes paid in a foreign country, ensuring they are not taxed twice on the same income.

✅ Example: If you earned income in the USA and paid taxes there, you can claim FTC in India to avoid being taxed twice.

✅ FTC can be claimed only if the foreign income is taxable in India.

Who Needs to File Form 67?

🔹 Indian Residents earning income abroad and paying taxes in the foreign country.
🔹 Businesses and Individuals receiving salary, investments, or capital gains from foreign sources.
🔹 NRIs with foreign income taxable in India.

When to File Form 67?

📌 Form 67 must be submitted before filing the Income Tax Return (ITR) for the relevant financial year.

📌 Last Date: 31st March 2025 (for FY 2023-24)

Filing Form 67 after ITR submission may result in loss of FTC benefits.

How to File Form 67?

Filing Form 67 is an online process through the Income Tax e-Filing Portal:

1️⃣ Login to the Income Tax e-Filing Portal.
2️⃣ Navigate to e-File > Income Tax Forms > Select Form 67.
3️⃣ Fill in details: Foreign income, taxes paid, and country of taxation.
4️⃣ Upload supporting documents, including proof of foreign tax payment.
5️⃣ Verify and submit before the due date.

Documents Required

📌 Tax Payment Proof from the foreign country.
📌 Income Statement showing earnings abroad.
📌 Tax Residency Certificate (TRC) if required.
📌 Form 16/Salary Slips (for salaried individuals).

Important Considerations

🔹 FTC can be claimed only if India has a Double Taxation Avoidance Agreement (DTAA) with the foreign country.
🔹 Foreign taxes must be paid before the due date of ITR filing.
🔹 Exchange rates for conversion should be taken from RBI on the last day of the financial year.

Penalties for Not Filing Form 67

🚨 Failure to submit Form 67 before ITR filing may lead to:
❌ Denial of Foreign Tax Credit (FTC).
❌ Higher tax liability in India due to double taxation.
❌ Increased scrutiny by tax authorities.

Conclusion

📢 If you have foreign income and have paid tax abroad, filing Form 67 is essential to avoid double taxation. Ensure timely submission before 31st March 2025.

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