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Microlesson · 5-min read

Section 10(6) – Exemptions for Non-Indian Citizens

# Exemptions for Non-Indian Citizens – Section 10(6)

These exemptions apply to foreign nationals in specified situations.

## 1. Officials of foreign embassies [Sec 10(6)(ii)]

Remuneration received by an official of an embassy, high commission, legation, commission, consulate or trade representation of a foreign State is exempt.

Conditions:

  • India's corresponding officials in that foreign country must enjoy a similar exemption (reciprocity).
  • The officials must be subjects of that country and not engaged in any other business/employment in India.

## 2. Foreign enterprise employee for services in India [Sec 10(6)(vi)]

Remuneration of a foreign national, as an employee of a foreign enterprise, for services rendered during their stay in India is exempt.

Conditions (all must be met):

  • The foreign enterprise is not engaged in any business in India.
  • The employee's stay in India does not exceed 90 days in the previous year.
  • The remuneration is not deductible from the employer's income under the Act.

## 3. Salary on foreign ships [Sec 10(6)(viii)]

Salary of a non-citizen, non-resident for services on a foreign ship is exempt, provided their stay in India does not exceed 90 days in the previous year.

## 4. Remuneration for training [Sec 10(6)(xi)]

Remuneration of foreign government employees during training in India is exempt, if training is at an establishment/office/undertaking owned by:

  • the Central or State Government,
  • a Government company or statutory corporation, or
  • a society wholly financed by the Central and/or State Government(s).

## Cross-regime note

Exemptions under Section 10(6) and 10(7) are available to an assessee irrespective of the tax regime (old or new) under which they pay tax.

Worked example

### Example 1

Foreign enterprise employee: Mr. Lee, a foreign national employed by a foreign enterprise (with no business in India), comes to India for 75 days. His remuneration is not deductible from the employer's Indian income. All three conditions of Sec 10(6)(vi) are met → his remuneration is exempt. If his stay had been 95 days, the exemption would be lost.

### Example 2

Foreign ship: A non-citizen, non-resident crew member earns salary on a foreign ship and stays in India for 60 days during the year. The salary is exempt u/s 10(6)(viii). Had the stay exceeded 90 days, it would be taxable.

⚠️ Common exam mistakes

  • Overlooking the 90-day stay limit in Sec 10(6)(vi) and 10(6)(viii).
  • Forgetting the reciprocity condition for embassy officials u/s 10(6)(ii).
  • Granting the foreign-enterprise exemption when the enterprise actually carries on business in India.
  • Assuming these exemptions are lost under the new tax regime — Sec 10(6)/(7) apply under both regimes.
Reference: Section 10(6)
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