NRI in Brazil, client in Goa: where will your professional income be taxed?

I recently moved to Brazil to work on a long-term project there and became an NRI. Having taken permission from my employer, I also provide architectural design and planning services to a resort company in Goa. The Goa company would pay professional fees into my foreign bank account. Will I be taxed in India on this payment?

– Name withheld on request

Assuming that you qualify as a non-resident of India (NR) for Tax Year 2026-27 under the Income-tax Act, 2025, you would be taxable in India only on income that is received or deemed to be received in India, or income that accrues or is deemed to accrue or arise in India.

The architectural design and planning services provided by you would be in the nature of consultancy services and would qualify as fees for technical services (FTS) under Indian tax law. Since the payment for such FTS is being made by an Indian resident company to you, being a non-resident, the income would be deemed to accrue or arise in India and would therefore be taxable at 20%, plus applicable surcharge and cess, under Indian tax law.

Treaty provisions

Assuming that you qualify as a tax resident of Brazil, the India-Brazil Double Taxation Avoidance Agreement (DTAA) would also need to be considered here. Under the majority of Indian treaties, architectural services come under the purview of the article dealing with Independent Personal Services. Ordinarily, income from Independent Personal Services is taxable only in the country of residence, unless the individual has a fixed base in India or stays in India for 183 days or more in any twelve-month period.

However, the India-Brazil DTAA is differently articulated than other DTAAs that contain similar provisions. It was recently amended to introduce provisions relating to FTS, which cover payments for consultancy services, similar to the concept of FTS under Indian tax law.

However, under this DTAA, where the services qualify as FTS, these provisions override the provisions relating to Independent Personal Services, unlike other DTAAs. Accordingly, since the architectural services are covered by the FTS provisions under the DTAA, the provisions relating to Independent Personal Services would not apply in your case and the tax payable in India would instead be restricted to 10% of the gross amount of the fees under the FTS provisions of the treaty.

Since the tax rate under the DTAA is more beneficial than the rate under Indian tax law, you can claim the benefit of the treaty and pay tax in India at 10% of the gross amount of the fees. To claim DTAA benefit in India, you would need to furnish a Tax Residency Certificate and Form 41 for TY 2026-27. Further, a tax credit can be claimed in Brazil for the taxes paid in India, subject to the applicable provisions of Brazilian tax law.