The following categories of persons are required
to produce a tax clearance certificate from the concerned assessing
officer prior to their departure:-
- persons who are not domiciled in India, and in whose case the
stay in India has exceeded 120 days;
- persons of Indian or non-Indian domicile whose names have been
communicated to the airlines/shipping Companies by the Income Tax
authorities;
- persons who are domiciled in India at the time of their
departure; but
- intend to leave India as emigrants; or
- intend to proceed to another country on a work permit with
the object of taking any employment or other occupation in that
country; or
- in respect of whom circumstances exist, which in the opinion
of the income tax authorities render it necessary for him to
obtain the Tax Clearance Certificate.
Such certificates is granted where there are no outstanding taxes under
the Income Tax Act, the Excess Profits Tax Act, the Business Profits Tax
Act, the Wealth Tax Act, the Expenditure Tax Act or the Gift Tax Act
against him or where satisfactory arrangements have been made for the
payment of any such taxes. Obtaining guarantee from the employer of the
person leaving the country is one of the methods of ensuring
satisfactory arrangement for payment of taxes. For those who have to go
abroad frequently for employer's work, facility of one-time Clearance
Certificate has been provided to the foreign employee who has a fixed
tenure of service in India or upto 5 years on furnishing an employer's
guarantee in the prescribed form for payment of any tax that may be
found due against him during the entire period of contract plus two
years.