DTTA on property sale as NRI

[manamthoupule]

I have sold a property India.
I have bought the property for 1cr and sold for 1.2cr within a year. I have 20 lakhs capital gains and paid around 35% (around 7 lakhs) TDS on the profit in India.
Have a question around DTAA.

My tax person in USA is saying I will get some refund from IRS since my tax rate here is less than India. I paid 35% TDS in India, so he is saying I will get refund from IRS. Is this correct ? I know we can claim credit for taxes paid in India but do we get refund back from IRS for extra tax paid in India ?

I couldn't find any details online about getting refund in USA for tax paid in India.

Can someone please confirm this ?

[idibezwada]

TDS is only if the profit is more than 50L kada?

[manamthoupule]

2 minutes ago, idibezwada said:

TDS is only if the profit is more than 50L kada?

No.

[Jatka Bandi]

57 minutes ago, manamthoupule said:

I have sold a property India.
I have bought the property for 1cr and sold for 1.2cr within a year. I have 20 lakhs capital gains and paid around 35% (around 7 lakhs) TDS on the profit in India.
Have a question around DTAA.

My tax person in USA is saying I will get some refund from IRS since my tax rate here is less than India. I paid 35% TDS in India, so he is saying I will get refund from IRS. Is this correct ? I know we can claim credit for taxes paid in India but do we get refund back from IRS for extra tax paid in India ?

I couldn't find any details online about getting refund in USA for tax paid in India.

Can someone please confirm this ?

baa, simple logic. Teleeka adugutunna. Pakka desam teesukunna dabbuki, akkada ayina kharchuki, inko desa janabha enduku istaru?

[manamthoupule]

4 minutes ago, Jatka Bandi said:

baa, simple logic. Teleeka adugutunna. Pakka desam teesukunna dabbuki, akkada ayina kharchuki, inko desa janabha enduku istaru?

I asked the same thing but the tax person in USA is saying that I will get refund which is confusing.

[manamthoupule]

Looking for suggestions from people who sold property in India and reported here.

[Moon_Walker]

3 minutes ago, manamthoupule said:

I asked the same thing but the tax person in USA is saying that I will get refund which is confusing.

He is right you file your tax returns in US for global income which includes income from India too like rentals or interest from FDs etc.

[Jatka Bandi]

4 minutes ago, manamthoupule said:

I asked the same thing but the tax person in USA is saying that I will get refund which is confusing.

As per the tax treaty, you don't need to pay double tax. But I don't think he is true. Consult a CA. You will get clear picture.

[Jatka Bandi]

1 minute ago, Moon_Walker said:

He is right you file your tax returns in US for global income which includes income from India too like rentals or interest from FDs etc.

akkada question adi kaadu. For a tax withholding made by Indian govt, the consultant claims this member will get a refund from the US govt.

[Moon_Walker]

Just now, Jatka Bandi said:

akkada question adi kaadu. For a tax withholding made by Indian govt, the consultant claims this member will get a refund from the US govt.

Yes he will get as he can claim that he already paid tax in India returns and get the refund if any. There is a concept of double taxation avoidance and u should read it.

[manamthoupule]

8 minutes ago, Moon_Walker said:

Yes he will get as he can claim that he already paid tax in India returns and get the refund if any. There is a concept of double taxation avoidance and u should read it.

@Moon_Walker I know we can claim credit for taxes paid in India but do we get refund back from IRS for extra tax paid in India ? I mean I don't need to pay taxes again here in USA but I don't think I will get refund from IRS for extra tax paid in India ? I couldn't find any details online on this.

[Moon_Walker]

16 minutes ago, manamthoupule said:

@Moon_Walker I know we can claim credit for taxes paid in India but do we get refund back from IRS for extra tax paid in India ? I mean I don't need to pay taxes again here in USA but I don't think I will get refund from IRS for extra tax paid in India ? I couldn't find any details online on this.

That is a weird statement. You are right about 'claiming the credit for taxes in India'. 

The second part is confusing "about getting back refund from IRS for extra taxes".  Claiming credit itself should have covered everything and i don't think there is anything extra after that.

[manamthoupule]

11 minutes ago, Moon_Walker said:

That is a weird statement. You are right about 'claiming the credit for taxes in India'. 

The second part is confusing "about getting back refund from IRS for extra taxes".  Claiming credit itself should have covered everything and i don't think there is anything extra after that.

@Moon_Walker This is my understanding. Let say if India taxes me at 10% but my federal tax bracket is let say 20% in USA, then I need to pay only 10% to USA since I already paid 10% in India. This is DTAA and I understand this.

 

But my situation is I paid 35% in India but my tax bracket is 20% in USA. Now my tax filer in USA is saying I will get back extra 15% paid in India from IRS. My question is I don't find any documentation anywhere online related to this. Maybe I'm wrong but I'm looking for opinions from people who actually sold property in India and reported those capital gains here.

[TechSri]

1 hour ago, manamthoupule said:

@Moon_Walker I know we can claim credit for taxes paid in India but do we get refund back from IRS for extra tax paid in India ? I mean I don't need to pay taxes again here in USA but I don't think I will get refund from IRS for extra tax paid in India ? I couldn't find any details online on this.

Your tax filer may be right. It is called Foreign Tax Credit in US tax filing 
 

the income coming from india as capital gain so india may have right to tax on it. Did you file income tax in india and paid 35%.  But question here is, you are non-resident in india and resident in usa so who should tax you on that capital gain generated from india is doubt

Nee buyer 30% TDS withhold chesi ichada neeku money when you sold? NRI seller ayithe 20% TDS withhold cheyalani undi   Did you file ITR tax filing in india already for this? first US lo file chesaka then india lo file cheyalemo kada so you can tell india about DTAA 
 

 for external link: 

https://timesofindia.indiatimes.com/nri/us-canada-news/nri-selling-immovable-property-in-india-there-are-strings-attached-know-tax-implications/amp_articleshow/106675333.cms

[manamthoupule]

11 minutes ago, TechSri said:

Your tax filer may be right. It is called Foreign Tax Credit in US tax filing 
 

the income coming from india as capital gain so india may have right to tax on it. Did you file income tax in india and paid 35%.  But question here is, you are non-resident in india and resident in usa so who should tax you on that capital gain generated from india is doubt

@TechSri I haven't yet paid taxes in India but when we sell property as NRI, buyer will deduct TDS before paying us. So short term gains TDS will be around 35% in India for NRI. India will tax us since the property is in India. We also need to report that when filing taxes in USA.