CA Vikas Agrawal 3 Jul 2018
It depends on the country, if we have a DTAA treaty with that country the withholding tax paid will be deducted from India tax.
Amit Kumar Sharma 3 Jul 2018
Yes DTAA treaty is in-force with the Country in question with India. Now tell me how to book the same and claim the same? CA Chirag Haraniya 4 Jul 2018
You should book in accounts as withholding tax receivable, just like normal TDS in Current Assets.
Amit Kumar Sharma 4 Jul 2018
While filing your Income Tax Return you can claim the credit of withholding tax which was deducted outside India, option of which is available in income-tax returns.
Thanks @ CA Chirag Haraniya. One more clarity, if such withholding tax is more than actual tax after computation, can we claim the balance as refund or carry forwarded. If yes then kindly refer me to the section in the act for the same. CA Chirag Haraniya 4 Jul 2018
Yes, for that you need to refer the Section 90/90A of Income Tax Act, 1961 read with Rule 128 of Income Tax Rules, along with the DTAA with respective country, If the DTAA allows full credit for the particular Income then you can claim entire tax paid outside India as Credit.