Taxpayers now have more time to claim credits for taxes paid outside India

The Central Board of Direct Taxes (CBDT) amended tax rules to make it easier for taxpayers to claim Foreign Tax Credit (FTC).

The Income Tax Department announced on Friday that taxpayers can claim credit for taxes paid outside India before the end of the fiscal year if the I-T return is filed by the deadline.

Previously, Foreign Tax Credit (FTC) could only be claimed if Form-67, along with all required documents, was filed by the due date for filing the original return, limiting the ability to claim credit for taxes paid outside India.

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The Central Board of Direct Taxes (CBDT) amended tax rules to make it easier for taxpayers to claim Foreign Tax Credit (FTC).

According to the change, this benefit is applicable for any FTC claims made during the current fiscal year.

Sachin Garg, Partner-Direct Taxation at Nangia Andersen LLP, stated that the amendment has provided much-needed relief to taxpayers, who can now claim FTC by submitting Form-67 along with required documents before the end of the fiscal year if the return is filed within the original due date or date of filing a belated tax return.

The FTC can now be claimed even when filing a revised income tax return, provided Form 67 is given before filing such a return. This will undoubtedly improve the convenience of doing business in India and avoid taxpayers from permanently losing FTC if Form 67 is not filed by the due date for filing income tax returns.