Auro Infotech handles many clients outside India and gets tax deductions for all Foreign Income, just like any other company from India that works with clients outside India.
In order to get these deductions, Auro Infotech will have to receive payments into its banks in foreign currency only.
Paypal is one of the payment gateways we use to receive payment from our clients. With Paypal’s feature to transfer money into banks in India, we used to withdraw from Paypal to our bank accounts as US Dollar and it was considered as foreign income.
After the recent changes announced by Paypal, the option to choose in USD or INR is removed and we have withdrawn two payments so far. We realized this week that the payment is coming in only as Indian Rupees, which will directly make us ineligible to get any tax deductions, as the payment is not considered by banks as foreign income, as it is received in Indian Rupees. This is a huge issue!