Tax Column

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Tax Column

Since you are a Resident in India, all your global receipts are subject to tax in India. Therefore, compensation received abroad is not relevant in your case. The question is whether compensation of USD 50,000 is a capital receipt or a revenue receipt which falls under the definition of income under Section 2(49) of the IT Act, 2025 (corresponding Section 2(24) of the IT Act, 1961).

Since you are a Resident in India, all your global receipts are subject to tax in India. Therefore, compensation received abroad is not relevant in your case. The question is whether compensation of USD 50,000 is a capital receipt or a revenue receipt which falls under the definition of income under Section 2(49) of the IT Act, 2025 (corresponding Section 2(24) of the IT Act, 1961).

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