Mrs. Kareena, an individual resident and citizen of India, earned remuneration in foreign currency from an enterprise in foreign country during her stay in that country in the previous year 2015-16. There is no DTAA with

Computation of Taxable Income & Tax Liability of Ms. Kareena in India (AY 2016-17) Particulars Amount (in ₹) Amount (in ₹) Income earned in India 2,00,000 Income earned outside India 8,00,000 Gross Total Income 10,00,000 Deduction under Chapter VI NIL Total Income 10,00,000 Tax Liability On first ₹2,50,000 NIL ₹2,50,001 - ₹5,00,000 @ 10% 25,000 ₹5,00,000 - ₹10,00,000 @ 20% 1,00,000 Total Tax (excluding EC & SHEC) 1,25,000 Education Cess & SHEC @ 3% 3,750 Total Tax 1,28,750 Average rate of Tax in India (₹1,28,750/₹10,00,000 * 100) = 12.875% Average rate of tax in foreign country (₹1,60,000/₹8,00,000 * 100) = 20% Doubly Taxed Income 8,00,000 Relief under section 91 (on ₹8,00,000 @ 12.875%) i.e. rate 20% or 12.875% whichever is lower (1,03,000) Tax payable in India 25,750 Note: Relief under section 91 would be calculated on doubly taxed income at average rate of tax in India or in foreign country whichever is lower. Since, the question is silent about the age of the assessee, it is assumed to be age of the assessee is under 60 year and therefore apply the normal tax slab rate applicable to an individual.