## Income Received / Deemed to be Received in India

### Receipt of Income

Receipt means the first occasion when the assessee gets the money under his control.

It is taxable on its actual receipt or deemed receipt.
Remittance or transmission of an already-received amount is NOT treated as receipt of income.

### Implication

Scenario	Is it 'Income Received in India'?
Income received outside India and later remitted to India	NO
Income received outside India, then physically brought to India	NO
Salary directly credited to Indian bank account from abroad	YES (first receipt in India)

### Examples of Deemed Receipt

Employer's contribution to RPF in excess of 12% of salary.
Interest credited to RPF in excess of 9.5%.
Transferred balance of URPF to RPF (to the extent of employer's contribution + interest).
Contribution by Central Government to NPS account.

## Income Accrual vs Due

### Accrue / Arise

Income accrues or arises when the right to receive the income becomes vested in the assessee.

### Due

'Due' refers to the right to enforce payment of the income.

### Illustration

Salary for work done in December accrues day-by-day throughout December.
It becomes due on the 31st December (or 1st January, depending on the salary structure).

Worked example

### Example 1

Example: Mr. X (NR) earned salary in Dubai (received in his Dubai account on 30 April 2025). He transferred this to his Indian SB account on 5 May 2025. Is the income 'received in India'?

Solution: First receipt occurred in Dubai. Subsequent remittance ≠ receipt. → NOT received in India. Not taxable for NR.

### Example 2

Example: Salary for the month of December 2025 is paid on 1st January 2026. State the date of accrual and due.

Solution: Accrues day-by-day through December 2025; becomes due on 1st January 2026.

⚠️ Common exam mistakes

Treating subsequent remittance to India as 'received in India' — only the first receipt matters.
Confusing accrual with due — accrual is the vesting of right to receive; due is the right to enforce payment.
Forgetting that even deemed receipts (like employer's excess RPF contribution) are taxable for an NR as 'received in India'.

Bare-Act text Section 5 read with Section 7 · Income-tax Act, 1961 · click to expand

Section 7 — Income deemed to be received: The following incomes shall be deemed to be received in the previous year— (i) the annual accretion in the previous year to the balance at the credit of an employee participating in a recognised provident fund, to the extent provided in rule 6 of Part A of the Fourth Schedule; (ii) the transferred balance in a recognised provident fund, to the extent provided in rule 11(4) of Part A of the Fourth Schedule; (iii) the contribution made, by the Central Government or any other employer in the previous year, to the account of an employee under a pension scheme referred to in section 80CCD.

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Income Received / Deemed to be Received and Accrual vs Due

Worked example

⚠️ Common exam mistakes