2 days ago
Brazil-Based Architect’s Goa Fees May Face Indian Tax
A professional moved to Brazil and still designs and plans projects for a company in Goa.
The Goa company plans to pay the fees into a bank account outside India.
India may still tax the income because the customer is an Indian company.
Indian law treats the work as technical or consultancy services.
The regular Indian tax rate would be 20%, plus surcharge and cess.
A tax treaty between India and Brazil may provide a lower rate.
If the person is a Brazilian tax resident, the treaty rate may be 10% of the total fees.
The person must provide a Tax Residency Certificate and Form 41 to claim the treaty rate.
An India-based professional who moved to Brazil is assumed to be a non-resident for Tax Year 2026-27.
Architectural design and planning services are treated as consultancy and fees for technical services under Indian tax law.
Because the client is an Indian resident company, the fees are deemed to accrue or arise in India, even if paid abroad.
Indian domestic law would tax the income at 20%, plus applicable surcharge and cess.
If the professional is a Brazilian tax resident, the India-Brazil treaty may limit Indian tax to 10% of gross fees, subject to required documents.
- Who
- An individual living in Brazil who provides architectural design and planning services to a resort company in Goa.
- What
- The Indian tax treatment of professional fees paid by the Goa company into the individual’s foreign bank account.
- Where
- The services are provided from Brazil for a company in Goa, India.
- When
- Tax Year 2026-27, assuming the individual qualifies as a non-resident of India.
- Why
- The fees are treated as fees for technical services paid by an Indian resident company, so they are deemed to accrue or arise in India.
Key facts
- Indian residence status
- The individual is assumed to be a non-resident of India for Tax Year 2026-27 under the Income-tax Act, 2025.
- Service classification
- Architectural design and planning are treated as consultancy services and fees for technical services.
- Domestic tax rate
- Indian domestic law provides for tax at 20%, plus applicable surcharge and cess.
- Treaty tax rate
- The India-Brazil DTAA may restrict Indian tax to 10% of the gross professional fees.
- Payment location
- Payment into a foreign bank account does not by itself determine whether the income is taxable in India.
- Treaty documents
- A Tax Residency Certificate and Form 41 for Tax Year 2026-27 are required to claim the treaty benefit.
- Potential Brazilian credit
- Brazil may allow a tax credit for Indian taxes paid, subject to applicable Brazilian tax law.
Sources
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