Insertion of new section 89A.
28. After section 89 of the Income-tax Act, the following section shall be inserted with effect from the 1st day of April, 2022, namely:––
Relief from taxation in income from retirement benefit account maintained in a notified country.
‘89A. Where a specified person has income accrued in a specified account, such income shall be taxed in such manner and in such year as may be prescribed.
Explanation.––For the purposes of this section,––
(a) “specified person” means a person resident in India who opened a specified account in a notified country while being non-resident in India and resident in that country;
(b) “specified account” means an account maintained in a notified country by the specified person in respect of his retirement benefits and the income from such account is not taxable on accrual basis but is taxed by such country at the time of withdrawal or redemption;
(c) “notified country” means a country as may be notified by the Central Government in the Official Gazette for the purposes of this section.’.
Notes on Clauses:
Clause 28 of the Bill seeks to insert a new section 89A in the Income-tax Act relating to relief from taxation in income from retirement benefit account maintains in a notified country.
The proposed new section provides that the income of a specified person from specified account shall be taxed in such manner and for such year as may be provided by rules and also defines the expressions “specified person”, “specified account” and “notified country”.
This amendment will take effect from 1st April, 2022 and will, accordingly, apply in relation to the assessment year 2022-2023 and subsequent assessment years.
