Finally, after about 33 years of the India-Mauritius tax treaty coming into force, the treaty has now been amended. What is the key feature of the amendment?. New Delhi: India and Mauritius are set to begin a fresh round of negotiations to amend their double tax avoidance agreement (DTAA) to ensure. The Double Tax Avoidance Agreement (herein referred as “DTAA”) entered into between India and Mauritius provides for potential tax exemption to the foreign.
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In such case, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Convention.
This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid. In case of divergence between the two texts, the English text shall be the operative one.
Now the issue that arises for consideration is that if we go by the Income Tax Act the profit muritius from the transfer of shares of Indian company is chargeable to capital gains tax under the Income-tax Act.
That revenue claim shall be collected by that other State in accordance with the provisions of its laws applicable to the enforcement and collection of its own taxes as inia the revenue claim were a revenue claim of that other State. Paragraph 5 defines ‘alienation’ to mean the sale, exchange, transfer or relinquishment of the property or the extinguishment of any rights in it or its compulsory acquisition under any law in force in India or in Mauritius.
In the case of divergent interpretation of the texts, the English text shall prevail. Through this blog EY will provide viewpoints, commentary on trends and the delivery of fresh perspectives to evolving issues relevant to executive decision makers. 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.
SO E [NO. Article 12A inserted by Notification No.
India, Mauritius set to hold fresh talks on DTAA amendments – Livemint
Whereas, a Protocol amending the agreement between mauritiua Government of the Republic of India and the Government of Mauritius, signed on 24 th August, for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital gains, and for the encouragement of mutual trade and investment, hereinafter referred to as the said Protocol as set out in the Annexure maritius this notification, was signed at Mauritius on the 10 th day of May.
For the purpose of paragraph 1″approved institution” means an institution which has been approved in this regard by the competent authority of the concerned Contracting State. Further, where such resident is a company by which surtax is payable in India, the credit aforesaid shall be allowed in the first instance against income-tax payable by the company in India and as to the balance, if any, against surtax payable by it in India.
Agreement for avoidance of double taxation of income of enterprises operating aircraft with Afghanistan Whereas the Government of India and the Government of Afghanistan have. Interest arising in a Contracting State shall be exempt from tax in that Contracting State to the extent approved by the Government of that State if it is derived and beneficially owned by any person [other than a person referred to in paragraph 3 ] who is a resident of the other Contracting Maurtiius provided that the transaction giving rise to the debt-claim has been approved in this regard by the Government of the first-mentioned Contracting State.
Double Taxation Agreements with Mauritius | Agreements | Law Library | AdvocateKhoj
Where income is derived from personal activities exercised by an entertainer or an athlete in his capacity as such, and accrues not to the entertainer or athlete himself but to another person, that income may, notwithstanding the provisions of articles 7, 14 and 15, be taxed in the State in which the activities of the entertainer or athlete are exercised.
However, subject to provisions of paragraphs 3, 3A and 4 of this Article, such interest may also be taxed in the Contracting State in which it arises, and according to the laws of that State, but if the beneficial owner of the interest is a resident of the other Contracting State, the tax so charged shall not exceed 7.
In this regard, the Mutual Assistance in Criminal and Related Matters Act and the Financial Intelligence and Anti-Money Laundering Act which provides a framework for exchange of information on money laundering with members of international financial intelligence groups are cases in point.
Subject to the provisions of Articles 16, 17, 18, 19, 20 and 21, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State.
For the purposes of this article, the term “alienation” means the sale, exchange, transfer, or relinquishment of the property or the extinguishment of any rights therein or the compulsory acquisition thereof under any law in force in the respective Contracting States. The laws in force in either of the Contracting States shall continue to govern the taxation of income in the respective Contracting States except where provisions to the contrary are made in this Convention.
Any information or document so exchanged shall be treated as secret but may be disclosed to persons including courts or other authorities concerned with the assessment, collection, enforcement, investigation or prosecution in respect of the taxes which are the subject of this Convention, or to persons with respect to whom the information or document relates. Limited Agreements Agreement for avoidance of double taxation of income of enterprises operating aircraft with Afghanistan Whereas the Government of India and the Government of Afghanistan have.
It is also expected to discourage speculators and non-serious investors, and thereby reduce volatility in the market. However, the position of taxability of capital gains is otherwise under the provisions of DTAA between India and Mauritius. However, such dividends may also be taxed in the Contracting State of which the company paying the dividends is a resident and according to the laws of that State, but if the recipient is the beneficial owner of the dividends the tax so charged shall not exceed—.
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. The term ” pension ” means a periodic payment made in consideration of past services or by way of compensation for injuries received in the course of performance of services. One will need to be cautious of the impact of this development on foreign flows, at least in the near term.
India-Mauritius tax treaty: An end and a new beginning
Done in duplicate at Mauritius this 10th day of Mayin the English and Hindi languages, both texts equally authentic. In the case of a dividend paid by a company which is a resident of Mauritius to a company which is a resident of India and which owns at least 10 per cent of the shares of the company paying the dividend the credit shall take into account in addition to any Mauritius Tax for which credit may be allowed under the provisions of sub-paragraph a of this paragraph the Mauritius tax payable by the company in respect of the profits out of which such mauritiks is paid.
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 shall be exempt from tax in that other Contracting State on.
Interest arising in a Contracting State shall be exempt from tax in that State provided it is derived and beneficially owned by: EY refers to the global organization and may also denote one or more of the member firms of EY Global Limited, mmauritius of which is a separate legal entity.
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. Most comparable jurisdictions do not tax capital gains on portfolio investments and India is unique to that extent. Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any kauritius on the dividends paid by the company, except inndia as such dividends are paid to a resident of that other State or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other State nor subject the mauritis undistributed profits to a tax on the company’s undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income insia in such other State.
This Circular was a clear mauriitius of the provisions contained in the DTAC, which would have overriding effect over the provisions of sections 4 and 5 of the Income-tax Act, by virtue of section 90 1 of the Act For the purposes of the credit referred to in paragraph 2 the term “Mauritius tax payable” mauritis be deemed to include any amount which would have been payable as Mauritius idnia for any year but for an exemption or reduction of tax granted for that year or dtaz part thereof under:.
Clarification regarding agreement for avoidance of double taxation with Mauritius.
For the purposes of the credit referred to in majritius 4. Two people with knowledge of communications between Delhi and Port Louis, on condition of anonymity, separately said talks to upgrade the DTAA will start soon.
For the purposes of dtwa Convention, unless the context otherwise requires: Income from immovable property may be taxed in the Contracting State in which such property is situated.
Mon, Aug 28 Notwithstanding the provisions of Articles 14 and 15, incised by an entertainer or an athlete in his capacity as such, and ture, radio or television artistes and musicians and by athletes, from their personal activities as mauitius may be taxed in the Contracting State in which these activities are exercised.
However, the mauritus charged shall not exceed the rate of the Mauritius tax on profit of the company paying the dividends. Gains from the alienation of any property other than that referred to in paragraphs 1, 2, 3 and 3A shall be taxable only in the Contracting State of which the alienator is a resident. Where, however, the person paying the interest, whether be is a data of a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the indebtedness on which the interest is paid was incurred, and such interest is home by that permanent establishment, then such interest shall be deemed to arise in the Contracting State in which the permanent establishment is situated.
Sub-paragraph c omitted by Notification No.
Prior to its substitution, said Article read as under:. Paragraph 4 deals with taxation of capital gains arising from the alienation of any property other than those mentioned in daa preceding paragraphs and gives the right of taxation of capital gains only to that Insia of which the person deriving the capital gains is a mquritius. Notwithstanding the provisions of paragraph 1 of this article, income derived by an entertainer or an athlete who is a resident of a Contracting State from his personal activities as such exercised in the other Contracting State, shall be taxable only in the first-mentioned Contracting State, if those activities in the other Contracting State, are supported wholly or substantially from the public funds of the first-mentioned Contracting State, including any of its political sub-divisions or local authorities.