Double taxation relief: treaty clarifies PE profit attribution and source tax limits on dividends, interest and royalties. The Protocol permits taxation in both Contracting States of income from immovable property and related capital gains and of directors' fees. For building sites and similar projects, only profits from the permanent establishment's own activities are attributed to it; deliveries of machinery or equipment from outside that State are excluded, and administrative expenses incurred outside India are deductible under section 44C of the Indian Income tax Act, 1961. The Protocol also fixes source taxation ceilings on distributed profits and applies a most favoured nation rule for dividends, interest, royalties and technical fees.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Double taxation relief: treaty clarifies PE profit attribution and source tax limits on dividends, interest and royalties.
The Protocol permits taxation in both Contracting States of income from immovable property and related capital gains and of directors' fees. For building sites and similar projects, only profits from the permanent establishment's own activities are attributed to it; deliveries of machinery or equipment from outside that State are excluded, and administrative expenses incurred outside India are deductible under section 44C of the Indian Income tax Act, 1961. The Protocol also fixes source taxation ceilings on distributed profits and applies a most favoured nation rule for dividends, interest, royalties and technical fees.
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