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igr001
Sep 12, 2011, 05:00 PM
I am a US citizen, resident of US. I am a considering becoming a shareholder in a trading company registered in India. What is the best way for me to receive profit distributions or dividends? If I obtain a PAN number in India will I pay taxes in India or still have to pay taxes in the US and claim a foreign taxes paid credit against my Indian tax withholding?

AtlantaTaxExpert
Sep 13, 2011, 03:42 PM
I cannot address the Indian tax implications, but as a U.S. citizen, then dividends earned in ANY compnay is subject to U.S. taxes.

MukatA
Sep 15, 2011, 03:06 AM
In India the receiver of dividends does not pay any income tax. It is tax free income. The company that distributes the dividends pays 15% dividend distribution tax.