Section 10(6)(viii): Tax Exemption for Salary Earned on a Foreign Ship
Section 10(6)(viii) of the Income-tax Act, 1961 provides a specific exemption for remuneration received by an eligible non-resident, non-Indian citizen for services performed in connection with employment on a foreign ship, subject to a limit on the person's stay in India.
What does Section 10(6)(viii) mean?
Section 10 lists incomes that are excluded when computing total income under the Income-tax Act, 1961. Clause (6)(viii) concerns remuneration received by a person who is not a citizen of India and is non-resident, for services rendered in connection with employment on a foreign ship, provided the person's total stay in India does not exceed 90 days during that previous year.
A previous year is the financial year in which income is earned. For example, under the 1961 Act, the financial year 1 April 2025 to 31 March 2026 is the previous year relevant to assessment year 2026-27. For tax years governed by the Income-tax Act, 2025, consult the applicable successor legislation and transitional provisions rather than assuming the old section numbering continues unchanged.
Eligibility and amount of exemption
| Eligible person | An individual who is not an Indian citizen and qualifies as non-resident under the applicable Indian income-tax residence rules. |
|---|---|
| Qualifying income | Salary or remuneration for services rendered in connection with employment on a foreign ship. |
| Maximum stay in India | 90 days in aggregate during the relevant previous year; a stay of more than 90 days fails this condition. |
| Amount exempt | The full amount of qualifying remuneration, if every statutory condition is satisfied. |
| Other income | Not covered merely because the recipient works on a ship; other receipts must be assessed separately. |
Conditions for claiming the exemption
- Foreign citizenship: The employee must not be a citizen of India.
- Non-resident status: The employee must be a non-resident for Indian income-tax purposes in the relevant year. Citizenship alone does not determine tax residence.
- Employment on a foreign ship: The remuneration must arise from services rendered in connection with employment on a foreign ship. Employment agreements, vessel registration details and voyage records help establish the facts.
- Stay not exceeding 90 days: Add up the person's stay in India during the previous year; it must be 90 days or fewer.
How the 90-day condition works
The condition refers to the aggregate stay in India during the previous year, not the length of a single visit or voyage. Separate entries into India must therefore be considered together. Maintain reliable immigration and travel records to support the calculation.
Illustrative example
A foreign citizen who is non-resident in India works aboard a foreign-registered ship and receives salary for that employment. If the person stays in India for a total of 62 days in the relevant previous year, the 90-day condition is met. Assuming the remaining statutory requirements are satisfied, the qualifying remuneration is exempt under Section 10(6)(viii). If the aggregate stay is 95 days, this exemption is not available for that year.
Is the exemption available to Indian seafarers?
No, not under this specific clause. Section 10(6)(viii) expressly concerns an individual who is not an Indian citizen. An Indian seafarer's salary must instead be examined under the general residence, source-of-income and other applicable rules. The mere fact that a vessel sails internationally does not establish an exemption.
Documents useful for supporting a claim
- Passport, nationality and immigration entry or exit records.
- Employment contract and salary statements.
- Ship registration or flag details and seafarer's service records.
- Voyage schedules and evidence supporting the total days spent in India.
- Records establishing non-resident status for the relevant tax period.
Relationship with tax residence and double taxation agreements
Non-resident status is determined under the applicable residence provisions, which are distinct from this exemption's 90-day condition. A tax treaty may separately affect taxing rights over employment income; its application depends on the specific treaty and the facts. The exemption under Section 10(6)(viii) should not be confused with a general treaty rule for seafarers.
Applicable law and official references
This page explains the provision historically numbered Section 10(6)(viii) of the Income-tax Act, 1961. India has enacted the Income-tax Act, 2025, applicable from 1 April 2026; readers dealing with later tax years should confirm the corresponding operative provision, commencement and savings rules from official sources.
- Income Tax Department: Income-tax Act and statutory materials
- India Code: official central legislation database
- Income Tax e-Filing Portal: current guidance and compliance services
Frequently asked questions
Does the exemption cover the entire salary?
Yes, qualifying remuneration is fully exempt if all requirements of the provision are met. It is not a fixed-amount deduction.
Is 90 days a limit for each visit?
No. It is a limit on the total stay in India during the relevant previous year.
Does a foreign passport alone qualify a person?
No. The person must also be non-resident, work in the relevant employment on a foreign ship and satisfy the stay condition.
Does this exemption apply to an Indian citizen employed by a foreign shipping company?
No. The statutory condition requiring the individual not to be an Indian citizen is not met.
Practical note: Tax treatment depends on the tax year, employment facts, residential status and relevant legislation. Review official statutory text before filing or relying on an exemption.