{"id":6733,"date":"2021-01-04T07:27:59","date_gmt":"2021-01-04T07:27:59","guid":{"rendered":"https:\/\/kuvera.in\/blog\/?p=6733"},"modified":"2021-01-06T04:41:32","modified_gmt":"2021-01-06T04:41:32","slug":"how-to-file-income-tax-returns-%f0%9f%a7%be-when-investing-internationally-%f0%9f%8c%8e","status":"publish","type":"post","link":"https:\/\/kuvera.in\/blog\/how-to-file-income-tax-returns-%f0%9f%a7%be-when-investing-internationally-%f0%9f%8c%8e\/","title":{"rendered":"How to file income tax returns  ? when investing internationally ?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_40 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" area-label=\"ez-toc-toggle-icon-1\"><label for=\"item-69eb5da161e8a\" aria-label=\"Table of Content\"><span style=\"display: flex;align-items: center;width: 35px;height: 30px;justify-content: center;direction:ltr;\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/label><input  type=\"checkbox\" id=\"item-69eb5da161e8a\"><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-5'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/kuvera.in\/blog\/how-to-file-income-tax-returns-%f0%9f%a7%be-when-investing-internationally-%f0%9f%8c%8e\/#1_Disclosing_foreign_asset\" title=\"1. Disclosing foreign asset:\u00a0\">1. Disclosing foreign asset:\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-5'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/kuvera.in\/blog\/how-to-file-income-tax-returns-%f0%9f%a7%be-when-investing-internationally-%f0%9f%8c%8e\/#2_Capital_gains_dividend_and_interest\" title=\"2. Capital gains, dividend, and interest:\u00a0\">2. Capital gains, dividend, and interest:\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-5'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/kuvera.in\/blog\/how-to-file-income-tax-returns-%f0%9f%a7%be-when-investing-internationally-%f0%9f%8c%8e\/#3_Claiming_credit_on_tax_withheld_on_the_dividends_in_the_US\" title=\"3. Claiming credit on tax withheld on the dividends in the US:\u00a0\">3. Claiming credit on tax withheld on the dividends in the US:\u00a0<\/a><\/li><\/ul><\/nav><\/div>\n<p><span data-preserver-spaces=\"true\">International investing is a great way to provide much-needed portfolio diversification to your portfolio. Tax implications of investing in US stocks are very similar to those of investing in Indian stocks.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">In this blog, we will run through the actual tax filing process for US equity investing. We will use the year-end tax statements that our partner &#8211; Vested provides at the end of the Indian financial year.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">You need to perform the following three main tasks:<\/span><\/p>\n<h5><\/h5>\n<h5><span class=\"ez-toc-section\" id=\"1_Disclosing_foreign_asset\"><\/span><strong><span data-preserver-spaces=\"true\">1. Disclosing foreign asset:\u00a0<\/span><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h5>\n<p><span data-preserver-spaces=\"true\">You need to disclose your foreign investments under<\/span><strong><span data-preserver-spaces=\"true\">\u00a0Schedule FA\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">(where FA stands for Foreign Asset).\u00a0<\/span>Schedule FA<span data-preserver-spaces=\"true\"> is available under ITR-2 while filing Income tax returns. This section will be available across all major tax-filing solutions and accessible on the government portal.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Here, you disclose the asset you own, the country where it&#8217;s held, the company&#8217;s address, its initial &#8211; peak, and closing value in rupee terms. You can copy the details of individual securities from the excel sheet provided to you by Vested.\u00a0<\/span><\/p>\n<p>&nbsp;<\/p>\n<h5><span class=\"ez-toc-section\" id=\"2_Capital_gains_dividend_and_interest\"><\/span><strong><span data-preserver-spaces=\"true\">2. Capital gains, dividend, and interest:\u00a0<\/span><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h5>\n<p><span data-preserver-spaces=\"true\">Similar to Indian equities, you disclose the proceeds on your US investments. You will get an excel file from Vested summarizing the proceeds, dividends, interest, long-term gains (if applicable), and short-term gains; with individual transactions and grouped heads.\u00a0\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">For capital gains:<\/span><\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li class=\"ql-indent-1\"><span data-preserver-spaces=\"true\">The amount shown in the file is in INR (converted at the specified rate as per tax rules). It simplifies the tax filing process.<\/span><\/li>\n<li class=\"ql-indent-1\"><span data-preserver-spaces=\"true\">You may choose to add the gains as a one-line item (if the amount is not large). <\/span>Let your tax expert take this call<strong><span data-preserver-spaces=\"true\">.\u00a0<\/span><\/strong><\/li>\n<li class=\"ql-indent-1\"><span data-preserver-spaces=\"true\">State the nature of the company as unlisted. <\/span><\/li>\n<li class=\"ql-indent-1\"><span data-preserver-spaces=\"true\">The securities transaction tax is not paid; hence do not select &#8220;STT paid option&#8221; if asked.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><span data-preserver-spaces=\"true\">For dividend and interest income:<\/span><\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li class=\"ql-indent-2\"><span data-preserver-spaces=\"true\">Add the INR amount from the CG file under other income.<\/span><\/li>\n<li class=\"ql-indent-2\"><span data-preserver-spaces=\"true\">Add gross dividend from foreign companies (in INR) from the summary file.<\/span><\/li>\n<li class=\"ql-indent-2\"><span data-preserver-spaces=\"true\">Add interest (in INR) from the summary file<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<h5><span class=\"ez-toc-section\" id=\"3_Claiming_credit_on_tax_withheld_on_the_dividends_in_the_US\"><\/span><strong><span data-preserver-spaces=\"true\">3. Claiming credit on tax withheld on the dividends in the US:\u00a0<\/span><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h5>\n<p><span data-preserver-spaces=\"true\">US government deducts tax at source from your dividend income. The US authorities have a double tax avoidance treaty with India that ensures that you as an Indian taxpayer, do not get taxed the second time for your dividend income.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Vested provides you\u00a0<\/span><strong><span data-preserver-spaces=\"true\">Form 67<\/span><\/strong><span data-preserver-spaces=\"true\"> that contains the information for you to claim the tax credit. If the tax withheld by the US authority is not significant then you may choose to not file this form and claim credit from the Indian tax authorities for it.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Assuming, you have completed the other sections in ITR (salary, business income, deductions), and you proceed to the US investing, here is the summary of to-do:<\/span><\/p>\n<ul>\n<li><span data-preserver-spaces=\"true\">File the Schedule FA form using file FA<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Add the capital gains as per file CG<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Include dividend and interest in the other income as per file CG<\/span><\/li>\n<\/ul>\n<p><span data-preserver-spaces=\"true\">Once the above is complete, you can proceed to submit the ITR.<\/span><\/p>\n<p>Have doubts? Connect with us <a href=\"https:\/\/app.kuvera.in\/support\" target=\"_blank\" rel=\"noopener noreferrer\">here<\/a>.<\/p>\n<p>Not started your international investing journey yet?<br \/>\n<a href=\"https:\/\/app.kuvera.in\/explore\/us-stocks\">Start today.<\/a><\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>International investing is a great way to provide much-needed portfolio diversification to your portfolio. Tax implications of investing in US stocks are very similar to those of investing in Indian stocks.\u00a0 In this blog, we will run through the actual tax filing process for US equity investing. We will use the year-end tax statements that [&#8230;]<\/p>\n<p><a class=\"btn btn-secondary understrap-read-more-link\" href=\"https:\/\/kuvera.in\/blog\/how-to-file-income-tax-returns-%f0%9f%a7%be-when-investing-internationally-%f0%9f%8c%8e\/\">Read More&#8230;<\/a><\/p>\n","protected":false},"author":11,"featured_media":6741,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false},"categories":[236],"tags":[445,314,450,397],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How to file income tax returns ? when investing internationally ? - Kuvera<\/title>\n<meta name=\"description\" content=\"Diversify your portfolio with US stocks. 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