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

In today’s global environment, many Indians earn income from foreign sources. Such foreign income is generally subject to tax in the country where it is earned. At the same time, under the Income Tax Act of 2025, Indian residents are also required to pay tax on their worldwide 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 claim this credit, taxpayers are required to file Form 44 with 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 file Form 44. As prescribed under Rule 152 of the Income Tax Rules, 2026, filing this form is mandatory. It contains details such as:

• Foreign income earned.
• Amount of foreign tax deducted or paid.
• Nature of the income and the country from which it was earned.
• Documents or certificates confirming the payment of foreign taxes.

Form 44 should be filed within the applicable tax year at the earliest. If the form is not submitted within the prescribed time, the taxpayer may risk losing the foreign tax credit for that particular year.

Contents of Form 44

Form 44 consists of four sections:

1. Basic Information: This section contains the taxpayer’s details, including name, PAN, and address, along with the relevant tax year and details of foreign income and foreign tax paid.
2. Refund Details: This section provides information about any refund of foreign taxes resulting from loss carrybacks or dispute resolution.
3. Verification: The taxpayer must provide a declaration and verify the information using a digital signature or Electronic Verification Code (EVC).
4. Attachments: Supporting documents, including foreign tax payment certificates and proof of payment, must be uploaded digitally.

Key Documents Required for FTC Claim

To support the Foreign Tax Credit claim made through Form 44, taxpayers must provide the following documents:

• A certificate or statement issued by 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 the 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. Ideally, it should be filed on or before the due date for filing the ITR under Section 156 of the 2025 Act.

Although the 2025 Act provides greater flexibility, failure to submit Form 44 before the completion of the final assessment may result in the Foreign Tax Credit claim being disallowed. Taxpayers should also ensure that the information reported in Form 44 is consistent with the details appearing in Form 168 (Unified AIS).

Claiming an FTC – Important Points

• Foreign Tax Credit (FTC) is available only for income tax, applicable surcharges, and cess. It cannot be claimed for penalties, interest, or fees.
• If the foreign tax liability is under dispute in the country where the income was earned, the FTC cannot be claimed until the dispute is settled and evidence of the final resolution is provided.
• Foreign taxes 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 foreign tax was paid.
• The Foreign Tax Credit is calculated separately for each foreign country, with the eligible credits subsequently aggregated.
• FTC can also be claimed when income is taxed under an alternative tax regime, such as Minimum Alternate Tax (MAT) applicable to companies, for the foreign income tax paid.

Conclusion

Form 44 is an important compliance requirement for claiming tax relief under the Income Tax Act of 2025. Taxpayers should claim the Foreign Tax Credit correctly and within the prescribed timelines to prevent the same income from being taxed twice. Maintaining accurate supporting documents and ensuring consistency across digital tax forms helps keep the process smooth and minimizes the possibility of disputes or litigation.

FAQ’s

1. What is Form 44 under the Income Tax Act?

Form 44 is used by eligible taxpayers to provide details related to foreign income and taxes paid outside India for claiming a foreign tax credit.

2. Who can claim a Foreign Tax Credit in India?

A resident taxpayer who has earned income outside India and paid tax on that income in a foreign country may be eligible to claim a Foreign Tax Credit in India, subject to applicable rules.

3. How do I claim Foreign Tax Credit in my ITR?

Foreign Tax Credit is generally claimed by furnishing the required details of foreign income and taxes paid and submitting the prescribed forms within the applicable deadline.

4. Is Form 44 mandatory for claiming Foreign Tax Credit?

Taxpayers should check the applicable ITR and reporting requirements for the relevant assessment year, as the form and procedure can depend on the nature of foreign income and the tax credit being claimed.

5. What documents are required to claim Foreign Tax Credit?

Documents may include proof of foreign income, evidence of foreign taxes paid or deducted, foreign tax statements, and other supporting records required under Indian tax rules.

6. Can I claim credit for foreign tax paid if I have already claimed a DTAA benefit?

Yes, a taxpayer may be able to claim relief under the applicable Double Taxation Avoidance Agreement (DTAA), subject to the conditions and limits prescribed under the treaty and Indian tax laws.

7. What is the difference between Foreign Tax Credit and DTAA relief?

Foreign Tax Credit generally allows tax paid in another country to be credited against Indian tax liability, while DTAA relief is provided under the relevant tax treaty to prevent the same income from being taxed twice.

8. What happens if I miss the deadline for submitting the required foreign tax credit form?

Missing the prescribed filing deadline may affect your ability to claim the Foreign Tax Credit. The consequences and available remedies depend on the applicable tax provisions and circumstances.

9. Is Foreign Tax Credit available for all types of foreign taxes?

No. Only eligible foreign taxes that satisfy the conditions under Indian tax law and, where applicable, the relevant DTAA can generally be considered for credit.

10. How is the amount of Foreign Tax Credit calculated in India?

The credit is generally subject to prescribed limits and cannot ordinarily exceed the Indian tax payable on the corresponding foreign income.

11. Do NRIs need to file Form 44 to claim Foreign Tax Credit in India?

The requirement depends on the taxpayer’s residential status, source of income, and the nature of the foreign tax credit being claimed. The applicable provisions should be checked for the relevant assessment year.

12. Can Foreign Tax Credit be claimed for tax deducted at source in another country?

A foreign tax deducted at source may qualify for credit if it represents an eligible foreign tax and the taxpayer satisfies the applicable documentation and reporting requirements.