Foreign travel expenses and Income tax return

By | June 7, 2016

Foreign Travel Expenses

Q What are the  details required in the income tax return regarding Foreign travel ?

As per the income tax forms prescribed , only Passport Number , if available , is required to be given in the income tax return.

Q Why do income tax department require passport number in income tax return ?

Income tax department require the passport number so that they can track whether the Assessee has incurred any expenses if had visited outside India. It may happen that the Assessee may do expenses from undisclosed source of Income i.e income on which no tax has been paid.

Q Should I pay tax on the foreign travel expenses  ?

In case foreign travel expenses are incurred from undisclosed sources/ sources on which no tax has been paid, then you have to pay tax on foreign travel expenses.

In case of Assessee is salaried employee  and he has gone outside India and incurred  foreign travel expenses for personal purposes out of his salary income .on which tax has already been paid, he need not worry since he had already paid the taxes on his source of income (salary income) out of which he had incurred foreign travel expenses.

In case of Assessee is businessmen and  has gone outside India and incurred  foreign travel expenses for personal purposes , then he has to justify as to what was the source of income . suppose he explained that he has withdrawn the amount of capital from his business , then also he need not worry as there is a proper justification for incurring foreign travel expenses.

Therefore you must do planning for your foreign travel expenses .

Since Assessee is require to give the details of all his bank accounts in income tax return, therefore you can not hide your foreign travel expenses.

Now a days foreign travellers pay all amounts by cheque from saving banks as hardly reputed travel firms in india and or abroad operating in india deal in cash payments.

Q Should I keep foreign travel expenses details?

Foreign travel expenses details can be asked by the income tax deparment at any time . Therefore you must keep the details of all your  Foreign travel expenses . list of few expenses details could be

  1. Boarding Passes
  2. Tickets
  3. Foreign Exchange conversion bills
  4. details of travelling expenses outside India
  5. Details of stay in Foreign Hotels / Bills of Foreign Hotels
  6. Details of Medical and other insurance  in Rupees in India before going abroad
  7. Any other expenses incurred outside India

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