What is Form 44 and How to Claim a Foreign Tax Credit?

In today’s world, many Indians earn income from foreign sources. Such foreign income is generally taxed in the country where it is earned. At the same time, under the Income Tax Act of 2025, residents are required to pay tax on their global income, including income earned from foreign countries.

To prevent the same income from being taxed twice, taxpayers in India can claim relief through the Foreign Tax Credit (FTC). To become eligible for FTC, taxpayers are required to submit Form 44 to the Income Tax Department.

What is Form 44?

A resident taxpayer who wants to claim a foreign tax credit for tax paid on foreign income must submit Form 44. As per Rule 152 of the Income Tax Rules, 2026, filing this form is mandatory. It contains details such as the following and acts as a declaration and evidence of taxes paid abroad:

• Foreign income earned.
• Amount of foreign tax deducted or paid.
• Nature of income and country of origin.
• Documents or certificates confirming payment of foreign taxes.

Form 44 must be submitted by the end of the relevant tax year, at the earliest. If the form is not filed within the prescribed time limit, the taxpayer may risk losing the foreign tax credit claim for that year.

Contents of Form 44

Form 44 is divided into four sections:

1. Basic Information: Details of the taxpayer, including name, PAN, and address; the relevant tax year; and information about foreign income and tax paid.
2. Refund Details: Information regarding any refund of foreign taxes resulting from loss carrybacks or dispute resolution.
3. Verification: Declaration and verification by the taxpayer through a digital signature or Electronic Verification Code (EVC).
4. Attachments: Supporting documents, such as foreign tax payment certificates and proof of payment, must be uploaded digitally.

Key Documents Required for FTC Claim

To support the claim made through Form 44, taxpayers must provide the following:

• A certificate or statement from the foreign tax authority or withholding agent showing the tax deducted or paid.
• Proof of payment of foreign tax, such as bank statements or tax receipts.
• A statement showing income earned from the foreign country.
• Relevant details reported in the Income Tax Return (ITR) under the applicable foreign income schedules.

Procedure and Due Date for Filing Form 44

Form 44 must be submitted electronically through the Income Tax Department’s e-filing portal. It should preferably be filed on or before the due date for submitting the ITR under Section 156 of the 2025 Act. Although the 2025 Act provides greater flexibility, not filing Form 44 before the final assessment may result in the FTC claim being disallowed. Taxpayers should also ensure that the figures reported in Form 44 correspond with the entries in Form 168 (Unified AIS) for consistency.

Claiming an FTC – Important Points

• FTC is permitted only for income tax, surcharges, and cess, and does not cover penalties, interest, or fees.
• Where foreign taxes are under dispute in the source country, FTC cannot be claimed until the dispute is settled and proof of the final settlement is provided.
• Foreign tax paid must be converted into Indian currency using the Telegraphic Transfer Buying Rate (TTBR) published by the Reserve Bank of India on the last day of the month immediately preceding the month in which the tax was paid.
• Foreign tax credit is calculated separately for each country, with the total credit aggregated accordingly.
• FTC remains available for foreign income tax paid even when income is assessed under alternative tax regimes, such as MAT for companies.

Conclusion

Form 44 is an important compliance requirement for claiming relief under the Income Tax Act of 2025. Taxpayers need to claim Foreign Tax Credit correctly and within the prescribed timelines to prevent the same income from being taxed twice. Maintaining accurate documentation and ensuring consistency across digital tax forms helps keep the process straightforward and free from disputes.

Disclaimer

This content is for informational purposes only and reflects provisions of the Income Tax Act as amended up to FY 2025–26. Please consult a Chartered Accountant for professional advice.

FAQs – Form 44 and Foreign Tax Credit

1. What is Form 44 in income tax?
   Form 44 is associated with claiming relief or credit for taxes paid outside India. Taxpayers should verify the applicable form requirements based on the relevant tax year and circumstances.
2. What is a Foreign Tax Credit (FTC)?
   Foreign Tax Credit allows eligible taxpayers to claim credit in India for certain taxes already paid on income earned outside India, subject to applicable rules and limitations.
3. Who can claim Foreign Tax Credit in India?
   A resident taxpayer who has paid tax on foreign income may generally claim FTC in India, subject to the Income Tax Act and applicable tax treaty provisions.
4. What is Form 67 used for?
   Form 67 is used to provide details for claiming Foreign Tax Credit in India. It contains information about the foreign income and taxes paid or deducted abroad.
5. Is Form 44 the same as Form 67?
   No. Form 44 and Form 67 should not be treated as interchangeable forms. Form 67 is specifically associated with claiming Foreign Tax Credit in India.
6. Is filing Form 67 mandatory for claiming FTC?
   Form 67 is generally required when claiming Foreign Tax Credit under the prescribed procedure. The taxpayer must provide the required foreign tax and income details.
7. Can Form 67 be filed online?
   Yes, Form 67 is filed electronically through the income tax e-filing portal, subject to the applicable filing procedure.
8. When should Form 67 be filed?
   Form 67 should be filed within the prescribed time limit for claiming Foreign Tax Credit. Taxpayers should check the rules applicable to the relevant assessment year.
9. What documents are required to claim Foreign Tax Credit?
   Documents may include proof of foreign tax paid or deducted, foreign tax statements, income statements, and supporting documents from the foreign jurisdiction.
10. Can FTC be claimed on foreign salary income?
    Yes, eligible taxpayers may claim FTC on foreign salary income where foreign tax has been paid and the applicable conditions are satisfied.
11. Can Foreign Tax Credit be claimed on foreign dividends?
    FTC may be available for foreign tax paid on dividend income, subject to the applicable Indian tax rules and DTAA provisions.
12. Can FTC be claimed on foreign capital gains?
    Foreign tax paid on eligible capital gains may qualify for FTC, provided the income and foreign tax meet the applicable requirements.
13. How is the Foreign Tax Credit amount calculated?
    The credit is generally limited to the lower of the foreign tax paid on the relevant income and the Indian tax payable on that same income, subject to applicable rules.
14. Can I claim credit for foreign tax that is higher than Indian tax?
    Generally, FTC cannot be claimed beyond the amount of Indian tax payable on the corresponding foreign income.
15. Is a DTAA required to claim Foreign Tax Credit?
    A DTAA can provide specific relief mechanisms and conditions for foreign tax credit. FTC may also be available under the Income Tax Act where applicable.
16. Can NRIs claim Foreign Tax Credit in India?
    The availability of FTC for an NRI depends on their residential status, the nature of income, where it was earned, and where the tax was paid.
17. What happens if Form 67 is not filed?
    Failure to comply with the prescribed Form 67 requirements may affect the taxpayer’s ability to claim Foreign Tax Credit. It is therefore important to follow the applicable filing procedure.
18. Can Foreign Tax Credit be claimed if tax was deducted at source abroad?
    Yes, foreign tax deducted at source may qualify for FTC if it represents eligible foreign tax and the required supporting documentation is available.
19. Does foreign income need to be reported in the Indian ITR?
    Eligible taxpayers may need to disclose foreign income and foreign assets in the appropriate sections of their Indian income tax return, depending on their residential status and circumstances.
20. Why should you seek professional help for Form 44 and Foreign Tax Credit?
    Foreign tax credit rules can involve Indian tax provisions, DTAA benefits, foreign tax documentation, and reporting requirements. Professional assistance can help ensure the credit is calculated and reported correctly.

Written by

Asha Ahuja Sethi (Head Admin at Jatin Sethi & Co., Chartered Accountants)