An APPEAL to the Hon’ble Finance Minister (FM), for announcing a ‘COVID Tax Relief’ for ‘Seafarers & NRI’s for FY 20-21 (AY21-22)’

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APPEAL to Hon’ble FM

 

for Covid Tax Relief to

 

Seafarers & NRI’s

for

FY 20-21 | AY 21-22

 

September 2020 (Updated in October 2020)

 

 

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An APPEAL to the Hon’ble Finance Minister (FM), for announcing a ‘COVID Tax Relief’ for ‘Seafarers & NRI’s for FY 20-21 (AY21-22)’

Hi

Hope all of you are safe and secure.

COVID has been a game changer across global business as well as our personal lives. I am not too sure how long with this continue, or is this the new normal (as many people say)?

 

With the challenges and restrictions in global travel, in March 2020, due to Covid, many NRI’s were stuck in India and many Seafarers could not go out on sail, as they had planned. Hence, as per the general tax laws for NRI Status, many would have become Resident Indians (for tax purposes) for FY 19-20, due to not being able to travel abroad in March 2020. Hence, they would have unnecessarily, been taxed in India in FY 19-20, due to no fault of theirs.

 

However, thanks to the Government of India, the Finance Ministry announced a relaxation in the NRI Status for FY 19-20, on the number of days required to be outside of India (appended Circular No 11 of 2020, dated 8^th May 2020). 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hence due to this Circular, many individuals were saved and protected from paying taxes in India, if they could not meet the NRI Status due to COVID in FY 19-20.

Please note, that the Circular for tax relief, was released on 8 May 2020 (for FY 19-20).

However, there is no Circular released yet, by the Government for FY 20-21 (Current Year). Hence there is a practical problem, where no one is sure as to how many days relief will be announced for FY 20-21. Will it be 30 days or 60 days or more? As the Circular is not released, most Seafarers & NRI’s are not able to plan their travel and work, and may are risking personal life and professional career by extended sailing to maintain NRI Status as per general terms of the law.

 

It will be of great help to all Seafarers and NRI’s if the Government announces the relief, now itself, rather than at the end of the financial year. If it is announced at the end of the year, or after the year, it will not help Seafarers plan their sailing time at all, and will only be an accounting entry and decision.

 

Appeal in the Supreme Court (Article updated in Oct 2020)

The Merchant Navy Offocer’s and Ladies Association (MNOLA) has also filed a Suit in the Supreme Court seeking special relief for Seafarers due to their inability to travel because of COVID, where the Supreme Court has issued a Notice seeking clarification on the matter of relief to the Seafaring community.

The details of the Suit are as follows:

 

You can refer to the following websites for latest updates:

1. https://main.sci.gov.in/php/case_status/case_status_process.php?d_no=17128&d_yr=2020
2. https://main.sci.gov.in/case-status
3. https://www.deccanherald.com/national/sc-issues-notice-to-centre-on-seafarers-plea-for-income-tax-concession-due-to-covid-19-895421.htm

 

An appeal to the Hon’ble Finance Minister and all her Team members, to oblige all the Seafaring community by making an early announcement for COVID relief for NRI Status, which will be immensely helpful to all Seafarers & NRI’s.

Stay Safe. God Bless.

Disclaimer: The opinion above, are as per the understanding of the Tax Laws, Compliances, & Circulars, supported by various Process Notes, Circulars and Case Laws and Years of experience of the Author. Please consult your Tax Advisor before taking any decision on this subject and article, because, the facts of each matter will be different and laws ‘may’ apply differently for each situation. The Article is just for a general explanation, to quell basic queries, doubts, the anxiety and rumours in the Cross Border community, including NRI’s, OCI, PIO’s, Expats, Seafarers, Professionals among others. Any loss or penalty or expenses of any nature whatsoever, will not be the liability of the Author or the Organisation.

 

Mr. Rohit Bajoria has more than two decades of experience in International & Cross Border Tax, NRI & Expat Tax, DTAA (Double Tax Avoidance), FEMA, Strategic Consulting, Asset Valuation, Accounting & Compliance, Banking & Financial Structuring, Cross Border Repatriation & Compliance among others. He has worked across the Country advising and assisting Global Clients, in various domains of Cross-Border Tax, Banking & Finance, across Industries in the MNC, Government & Non-Government segments.

He has gained a wealth of experience in International Tax & Compliance, Finance & Restructuring, Valuation, Credit Appraisals & other verticals in Tax, Compliance & Finance.

Currently, he is a Partner in Tax Assist (An Alfred Jordan initiative) and advises Clients located globally, on Cross Border Taxation & Compliance.

His other interests lie in writing articles in International & National Journals on Tax & Financial matters and he is working on a Book which is to be published soon. He frequently writes articles in Asean Affairs & other periodicals & magazines. He is actively involved with a few Orphanages and tries to support them actively. He can be reached on rohit@TaxAssist.in

 

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