The tax treaty between India and Mauritius was signed in in keeping with India’s strategic interests in the Indian Ocean and India’s close cultural links with . not taxable in India under the provisions of the Double Taxation Avoidance Agreement (tax treaty) between India and Mauritius. In detail. Facts. The country that is next in line is Singapore with a FDI inflow to India in the same period amounting to INR , crores. While Mauritius accounts for 34% of.
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The terms “resident of India” and “resident of Mauritius” shall ibdia construed accordingly. The term “interest” as used in this Article means income from debt-claims of every kind, whether or not secured by mortgage, and whether or not carrying a right to participate in the debtor’s profits, and, in particular, income from Government securities daa income from bonds or iindia, including premiums and prizes attaching to such securities, bonds or debentures.
As per the information available, the benefit of the reduced tax rates will be available to those Mauritius entities who: For the purposes of this article, the term “Government” shall include any State Government or local or statutory authority of either Contracting State and, in particular, the Reserve Bank of India and the Bank of Mauritius. Such persons or authorities shall use the information only for such purposes. It develops leaders who team up to deliver on their promises to all its stakeholders.
Article 13 4 of the DTAA confers the power of taxation of the gains derived by a resident of a contracting state from the alienation of specified property only in the state of residence i. The protocol gives India the right to tax capital gains on transfer of Indian shares acquired on or after 1 April Photo: The competent bdtween of the Contracting States may communicate with each other directly for the purpose of reaching an agreement to have an oral exchange betwewn opinions, such exchange may take place through a Commission consisting of representatives of the competent authorities of the Contracting States.
Income-tax Indiz Taxation Relief Aden Rules, – Present position thereunder These Rules being consistent with the corresponding provisions of the Act, continued to be. Where under this Convention a resident of a Contracting State is exempt from tax in that Contracting State in respect of income derived from the other Contracting State, then the first-mentioned Contracting State may, in calculating tax on the remaining income of that person, apply the rate of tax which would have been applicable if the income exempted from tax in accordance with this Convention had not been so exempted.
However, this exemption shall apply only if such interest arises from debt-claims existing on or before 31 st March, The provisions of paragraph 1 shall apply to income derived from the direct use letting, or use in any other form of immovable property.
Now, therefore, in exercise of the powers conferred by section 90 of the Income-tax Act, 43 of and section 24A of the Companies Profits Surtax Act, 7 of the Central Government hereby, directs that all the provisions of the said Convention, shall be given effect to in the Union of India.
India-Mauritius DTAA Revised
According to the tax treaty between India and Mauritius, capital gains can only be taxed in Mauritius, the same treaty exist with 16 other countries. Article 26A inserted by Notification No.
Clarification regarding agreement for avoidance of double taxation with Mauritius. Notwithstanding the provisions of paragraphs 3 and 4, a revenue claim accepted by a Contracting State betwsen purposes of paragraph 3 or 4 shall not, in that State, be subject to the time limits or accorded any priority applicable to a revenue claim under the laws of that State by reason of its nature as such.
The term ‘ interest ‘ as used in this Article means income from debt-claims of every kind, whether or not secured by mortgage, and whether or not carrying a right to participate in the debtor’s profits, and, in particular, income from Government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures.
Where, by reason of a special relationship between the payer and the recipient or between both of them and some other person, the amount of the interest paid, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the recipient in the absence of such relationship, the provisions of this article shall apply only to the last-mentioned amount.
Mzuritius looking to take benefit must also keep provisions surrounding GAARwhich come into effect also from mayritius of Aprilin mind. However, this exemption shall apply only if such interest arises from debt- claims existing on or before 31 st March, The competent authorities of the Contracting States shall agree from time to time on the list of the information or documents which shall be furnished on a routine basis.
The amount of Indian tax payable under the laws of India and inaccordance with the provisions of this Convention, whether directly or by deduction, by a resident of Mauritius, in respect of profits or income arising in India, which has been subjected to tax both in India and Mauritius shall be allowed as a credit against Mauritius tax payable in respect of such profits or income provided that such credit shall not exceed the Mauritius tax as computed before allowing any such credit is appropriate to the profits or income arising in India.
The Mauritius route is a channel used by foreign investors to invest in India. The provisions of paragraphs 1, 2 and 3 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, carries on business in the other Contracting State of which the company paying the dividends is a resident, through a permanent establishment situated therein or performs in that other State independent personal services from a fixed base situated therein and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment or fixed base.
Any pension paid by the Government of a Contracting State to an individual who is a national of that State, shall be taxable only in that Contracting State. The competent authorities of the Contracting States shall agree from time to time on the list of the information or documents which shall be furnished on a routine basis.
Any pension paid by the Government of a Contracting State to an individual who is a national of that State, shall be taxable only in that Contracting State. Taxability of Interest earned by banks Other changes agreed to between the countries pertain to taxation of interest income from India earned by banks based in Mauritius.
Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein.
India-Mauritius tax treaty: An end and a new beginning
A student or business apprentice who is or was a resident of one of the Contracting States immediately before visiting the other Contracting State and who is present in that other Contracting State solely for the purpose of his education or training, indix be exempt from tax in that other Contracting State on—.
Interest arising in a Contracting State shall be exempt from tax in imdia State mauditius it is derived and beneficially owned by:. Interest arising in a Contracting State shall be exempt from tax in that State provided it is derived and beneficially owned by: In that case, the excess part of the payments shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Convention.
Each of the Contracting State shall notify to the other completion of the procedures required by vtaa law for the bringing into force of this Convention. Where by reason of the provisions of paragraph 1an individual is a resident of both Contracting States, then his residential status for the purposes of the Convention shall be determined in accordance andd the following rules:.
For the purposes of the preceding paragraphs, the profits to be attributed to the permanent establishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through a Commission consisting of representatives of the competent authorities of the Contracting States.
India-Mauritius tax treaty: An end and a new beginning | Forbes India Blog
Paragraphs 3A and 3B inserted by Notification No. However, the tax charged shall not exceed the rate of the Mauritius tax on profits of the company paying the dividends. For the purposes of paragraph 1, interest on funds connected with the operation of ships or aircraft in international traffic shall be regarded as profits from the operation of such ships or rtaa, and the provisions of Article 11 shall not apply in relation to such interest.
Retrieved 13 July The provisions of Article 6 and 7 of this Protocol shall have effect from the date of entry into staa of the Protocol, without regard to the date on which the taxes are levied or the taxable years to which the taxes relate.
Notwithstanding the provisions of paragraph 2 of this Axticle and Articles 7, 14 and 15, where income is derived from personal activities exercised by an entertainer or an athlete in his capacity as such in a Contracting State and accrues not to the entertiner or athlete himself but to another person, that income shall be taxable only in the Contracting State, if that other persons is supported wholly or substantially from the public funds of that other Contracting State, including any of its political sub-divisions or local authorities.
International Taxation >Double Taxation Avoidance Agreements
An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other State through a broker, general commission agent or any other agent of an independent status, where such persons are acting in the ordinary course of their business. Article 26 substituted by Notification No. Under the Income Tax Act of India, there are two provisions, Section 90 and Section 91, which provide specific relief to taxpayers to save them from double taxation.
Subject to the provisions of paragraph 2 of this Article, items of income of a resident of a Contracting State, wherever arising, which are not expressly dealt with in the foregoing Articles of this Convention, shall be taxable only in that Contracting State. They may also consult together for in the elimination of double taxation in cases not provided for the Convention.
After a series of high-profile court hearings, the status quo appeared to have been restored. An end and a new beginning The stride taken by the Government perhaps also reflects their belief in the economy and the ability to attract foreign investment without tax incentives. Remuneration, other than pension, paid by the Government of a Contracting State to an individual who is a national of ibdia State in respect of services rendered to that State, shall mauuritius taxable only in that State.
For the purposes of the credit referred to in paragraph 4the term “Indian tax payable” shall be deemed to include any amount by which tax has been reduced by the special incentive measures under—.