Claiming a Tax Treaty Under the 2025 Act: the TRC, Form 41 for Form 10F, and Form 44 for Form 67

An engineer from Bengaluru spends four months at her company's office in the United States, and suppose the US taxes the salary she earns there. India, where she is resident, taxes her income from everywhere, including those four months. Without relief she would pay tax twice on the same salary.

That is the problem tax treaties exist to solve, and the Income-tax Act, 2025 has rebuilt the machinery around them. The sections have new numbers, five familiar forms have new numbers, and the foreign tax credit form now needs a chartered accountant's signature in more cases.

Where treaties sit now

• Section 159 is the old sections 90 and 90A together: the power to make and adopt tax treaties.
• Section 160 is the old section 91: relief where India has no treaty with the other country.

Section 159 keeps the principles that decide most cases.

• The more beneficial rule. Under section 159(4), where a treaty applies, the Act applies only to the extent it is more beneficial to the taxpayer.
• No treaty-shopping. Under section 159(3)(b), treaties are meant to avoid double taxation "without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance", including treaty-shopping.
• GAAR still applies. Section 159(6) says the general anti-avoidance rules in Chapter XI apply "even if such provisions are not beneficial" to the taxpayer.

For a non-resident: the certificate and Form 41

Under section 159(8), a non-resident can claim treaty relief only if they have a Tax Residency Certificate from the government of their country, and they provide such other documents and information as are prescribed.

Rule 75(1) prescribes that information in Form 41, which replaces Form 10F. It asks for the tax year, the status, the country of residence or incorporation, the tax identification number there, the period for which the certificate applies, the address abroad for that period, and a copy of the certificate. Unlike Form 10F, it does not ask for nationality. Rule 75(2) adds that the documents behind Form 41 must be kept, because the department can call for them.

In practice, this is the TRC that appears in Form 146 when a treaty rate is claimed on a remittance.

For a resident: proving residence abroad

The other direction has new numbers too. A resident who needs a certificate of Indian residence applies in Form 42, and the Assessing Officer issues it in Form 43. They replace Forms 10FA and 10FB.

Foreign tax credit, rule by rule

Rule 76, the successor to rule 128, gives a resident credit for foreign tax paid on income that India also taxes. Its logic is exact.

• In the right year. Credit is allowed in the tax year in which the income is offered to tax in India. If the income is spread over years, so is the credit.
• Source by source, country by country. Credit is computed separately for each source of income from each country, and is the lower of the Indian tax on that income and the foreign tax paid on it.
• Only up to the treaty rate. Where foreign tax exceeds what the treaty allows, the excess is ignored.
• Converted at a fixed rate. Foreign tax is converted at the telegraphic transfer buying rate on the last day of the month before the month in which it was paid or deducted.
• Not for disputed tax, yet. Foreign tax under dispute gets no credit until the dispute is settled. Then, within six months from the end of the month of settlement, evidence is furnished in Form 45, which replaces Form 71.
• Tax, not extras. Credit is set against tax, surcharge and cess, never against interest, fee or penalty.

The form, the deadline, and the new signature

The statement of foreign income and foreign tax is now Form 44, the successor to Form 67. Rule 76(12) sets its deadline: within twelve months from the end of the tax year, provided the return for that year was furnished within the time allowed under section 263(1) or (4). With an updated return, it goes in with the return.

Rule 76(16) adds a requirement that wasn't there before. Form 44 must be verified by a chartered accountant:

• where the taxpayer is a company; or
• in any other case, where the foreign tax paid for the year is ₹1,00,000 or more.

For a salaried professional with an overseas stint, the credit now comes with a chartered accountant's signature once foreign tax reaches ₹1 lakh.

Work out your credit

Before the next claim

• Non-residents claiming a treaty rate: get the TRC before the payment, and file Form 41 with the information it asks for.
• Residents with foreign income: list each source by country, with the proof of foreign tax, and keep the exchange-rate working on file.
• Form 44: check whether it needs a CA's verification, and file it within twelve months of the year end, with the return filed on time.
• Disputed foreign tax: leave it out of the claim, and diary Form 45 for six months after the dispute ends.

Where this comes from

The law is sections 159 and 160 of the Income-tax Act, 2025 as amended by the Finance Act, 2026, which made no change to them. The procedure is rules 75 and 76, Forms 41 to 45, and rule 207 of the Income-tax Rules, 2026 as published in the Gazette of India, G.S.R. 198(E), 20 March 2026. They apply from tax year 2026-27. Claims for earlier years follow the 1961 Act and the 1962 Rules, including Forms 10F and 67. For how residence itself is decided, see residential status under the 2025 Act.