All You Need to Know About Expatriate Tax Services


Taxation can be a complex subject matter to wrap your head around. The changes in taxation regimes further add to the complexities. One of the most challenging segments is related to taxation for expatriates. Since there are two countries involved, a lot of differences have to be settled for computing taxes. However, expatriate tax service providers have a sound understanding of the tax structure for expat professionals. Read on to learn more about expats and expatriate tax services.

Who is an Expatriate?

An expatriate, also popularly known as expat, is any person residing and working in a country different from their native one. Many expats relinquish the citizenship of their native nations to become a citizen of their country of residence. However, it is essential to note that there is no legal definition for an expat as per the Indian Income Tax Act, 1961. Therefore, accounting firms in India determining the residential status of a person is important to apply the expat related taxes. This status is determined based on the person’s physical presence in India. 

Taxation for Expats

Here are some crucial terminologies associated with the taxation structure for expats.

  • Double Tax Avoidance Agreement (DTAA)

Double Taxation can be explained as the act of levying taxes by two or more nations on an individual’s income. The Double Tax Avoidance Agreement is a legal agreement signed between different nations to help taxpayers refrain from paying more than one tax on their income. India has signed a DTAA agreement with over 88 nations globally. It is applied if a person’s country of residence and income are different. 

  • Certificate of Coverage (COC)

All employers have to contribute to a nation’s social security scheme for the welfare of their employees. For example, Indian firms contribute to the Employee Provident Fund Organisation (EPFO) on behalf of their employees. When a person earns income by working in a foreign nation, a contribution is made by their employer to the social security scheme for that country. However, in the case of short-term employment, Financial Due Diligence the employee/individual will not be able to reap the full benefits. Therefore, they can choose to refrain from contributing to such programs if they are making the same contribution to their native country’s social security program. A Certificate of Coverage or COC helps to prove this claim. 

  • Income Tax Clearance Certificate (ITCC)

Before leaving the domestic Indian territory, expats need to obtain their Income Tax Clearance Certificate (ITCC) from a certified authority. It should state that the person doesn’t have any existing tax liabilities in the domestic country. 

Why opt for an expatriate tax service?

Expatriate tax services are designed to simplify the hassles of moving abroad for work endeavours. It helps to ensure that you are fully compliant with all domestic and foreign tax requirements. By hiring a reliable expatriate service provider like AKM Global, you can keep all taxation worries aside and focus on your work. They help you comply with the social security and tax norms as per the legal guidelines. In addition, expatriate tax service providers are constantly updated on the latest laws and regulations to help their clients in the best possible manner.


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