Not for everyone: Govt clarifies on tax clearance certificates for Indians moving abroad
Nirmala Sitharaman, through the Union Budget 2024, has introduced a significant amendment for those planning to move abroad from India. This new provision mandates that individuals domiciled in India must clear all tax dues and obtain 'clearance certificates' before leaving the country. However, the government has clarified that, the proposed amendment does not require every person to obtain a tax clearance certificate.
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Instead, only specific individuals who meet certain criteria, such as involvement in financial irregularities or having substantial tax arrears, are required to secure this certificate. The proposed amendment ensures a focused and justified application of this requirement, affecting only those who fall within these defined categories.
«As per section 230 of the Income-tax Act, 1961, every person is not required to obtain a tax clearance certificate. Only in the case of certain persons, in respect of whom circumstances exist which make it necessary to obtain a tax clearance certificate will be required to obtain such certificate,» the notification said.
Who needs to get this tax clearance certificate?
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- Involvement in Serious Financial Irregularities: If a person is suspected of serious financial misconduct and their presence is crucial for investigations under the Income-tax Act or
