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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Tax avoidance India—Mauritius relations Taxation in India. This reverses the ebtween position on taxation of such incomes and gives India the dtaa to tax capital gains arising on or after April 1,that arise from the sale of shares of an Indian entity. Interest arising in a Contracting An and paid to a resident of the other Contracting State may be taxed in that other State. However, this exemption shall apply maueitius if such interest arises from debt- claims existing on or before dtaaa st March, When a revenue claim of a Contracting State is a claim in respect of which that State may, under its law, mquritius measures of conservancy with a view indai ensure its collection, that revenue claim shall, at the request of the competent authority of that State, be accepted for purposes of taking measures of conservancy by the competent authority of the other Contracting State.
The existing taxes to which this Convention shall apply are: For the purposes of this Convention, unless the context otherwise requires:. However, such fees for technical services may also be taxed in the Contracting State in which they arise, and according to the laws of that State, but if the beneficial owner of the fees for technical services is a resident of the other Contracting State the tax so charged shall not exceed 10 per cent of the gross amount of the fees for technical services.
Retrieved 13 July For the purposes of the credit referred to in paragraph 2 the term “Mauritius tax payable” shall be deemed to include any amount which would have been payable as Mauritius tax for any year but for an exemption or reduction of tax granted for that year or any part thereof under:.
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 aircraft, and the provisions of Article 11 shall not apply maurltius relation to such interest. Where by reason of the provisions of pargraph 1, an individual is a resident of both Contracting States, then his residential status for the purposes of this Convention shall be determined in accordance with the following rules.
The competent authorities of the Contracting States shall exchange such information or document as is necessary for carrying out lndia provisions of this Convention or for prevention of evasion of taxes which are the subject of this Convention. The term “immovable property” shall be defined in accordance with the law and usage of the Contracting State in which the property is situated.
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 if the revenue claim were a revenue claim of that other State.
That other State shall take measures of conservancy in respect of that revenue claim in accordance with the provision of its laws as if the revenue claim were a revenue claim of that other State even if, at the time when such measures are applied, the revenue claim is not enforceable in the first-mentioned State or is owned by a person who has a right to prevent its collection. 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.
Recent news of India and Mauritius signing a Protocol to amend their 33 year old tax treaty caused seismic changes in the tax world. If the place of effective management of a shipping enterprise is abroad a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is resident.
Existing investments will be grandfathered. 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 with the following rules: 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. Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.
When a revenue claim of a Contracting State is enforceable under the laws of that State and is owed by a person who, behween that time, cannot, under the laws of that State, prevent its collection, that revenue claim shall, at the request of the mauritous authority of that State, be accepted for purposes of collection by the competent authority of the other 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.
The competent authorities of the Contracting States shall exchange such information including documents or certified copies thereof as is foreseeably relevant for carrying out the provisions of this Convention or to the administration or enforcement of domestic laws concerning taxes of every kind and description imposed on behalf of the Contracting States, or of their political subdivisions or local authorities, insofar betwen the taxation thereunder is not contrary to the Convention.
The Double Tax Avoidance Agreement between India and Mauritius
EY Global Limited, a UK company, which is limited by guarantees, does not provide services to clients. Article 22 Other Income of the Convention shall be amended by inserting after paragraph 2 the following new paragraph:.
In the case of a dividend paid by a company which is a resident of India to a company which is a resident of Mauritius 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 Indian Tax for which credit may be allowed under the provisions of sub-paragraph a of this paragraph mauritisu Indian tax payable by the company in respect of the profits out of which such dividend is paid.
In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply. For the purpose of this Article, the term ” Government ” shall include any State Inndia or local or statutory authority of either Contracting State and, in particular, the Reserve Bank of India and the Bank of Mauritius.
A much needed and timely impetus. Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. The term “dividends” as used in this Article means income from shares or other rights, not being debt-claims, participating in profits, as well as income from other corporate rights which is subjected to the same taxation treatment as income from shares by the laws of the Contracting State of which the company making the distribution is a resident.
Now, therefore, in exercise of the powers conferred indix sub-section 1 of section 90 of the Income-tax Act, 43 ofthe Central Betwedn hereby notifies that all the provisions of said Protocol, as annexed hereto as Annexure, shall be given effect to in the Union of India, in accordance with Article 9 of the said Protocol. Politically, this would be viewed as an achievement for the Government.
This article shall not apply to income from research if the research is undertaken primarily for the private benefit of a specific person or persons.
Prior to its substitution, said paragraph read as under: This approach has resulted in significant long-drawn litigation in a number of cases involving investments in India through Mauritius. Each of the Contracting States shall notify to the other the completion of the procedures required by its law for the bringing into force of this Protocol.
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. For the purposes maruitius 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.
Any pension, other than a pension referred to in article 18, or any annuity derived by a resident of a Contracting State from sources within the other Contracting State shall be taxed only in the first-mentioned Contracting State.
In no case shall the provisions of paragraphs 1 and 2 be construed so as to impose on a Contracting State the obligation:.
India-Mauritius DTAA Revised | CNK RK & Co, Chartered Accountants
This assistance is not restricted by Article 1 and 2. A bane of contention in the digital ad ecosystem Post-merger tales: 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.
The fact that a company, which is a resident of a Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other Contracting State whether through a permanent establishment or otherwise shall not, of itself, constitute either company a permanent establishment of the other. In this Article, the term ” taxation ” means taxes which are the subject of this Convention.
Where, at any time after a request has been made by a Contracting State under paragraph 3 or 4 and before the other Contracting State has collected and remitted the relevant revenue claim to the first-mentioned State, the relevant revenue claim ceases to be —. The term “professional services” includes especially independent scientific, literary, artistic, educational or teaching activities, as well as the independent activities of physicians, lawyers, engineers, architects, dentists and accountants.
The Contracting States shall lend assistance to each other in the collection of revenue claims.
Double Taxation Agreements with Mauritius | Agreements | Law Library | AdvocateKhoj
In determining the profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the business of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere.
Soon enough, the Indian tax officers did not appreciate the prospect of perceived letter box companies in Mauritius claiming the tax exemptions and sent tax bills to them, alleging misuse of treaty.
Sub-paragraph c omitted by Notification No.