TaxTMI 
TaxTMI 
taxability of Technical fees to korean directors
01 Jul 2010 
3 Replies 
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Technical fees taxability: cross-border technical services to a nonresident director may attract source-based tax and DTAA withholding.
Payments for technical guidance by a Korea-resident director who performs services from Korea but visits India infrequently are treated as Fees for Technical Services deemed to accrue or arise in India and thus prima facie taxable; however, the India-Korea Double Taxation Avoidance Agreement may override domestic treatment and prescribe the applicable withholding tax rate, and potential domestic service tax consequences should also be considered. (AI Summary)
Payments for technical guidance by a Korea-resident director who performs services from Korea but visits India infrequently are treated as Fees for Technical Services deemed to accrue or arise in India and thus prima facie taxable; however, the India-Korea Double Taxation Avoidance Agreement may override domestic treatment and prescribe the applicable withholding tax rate, and potential domestic service tax consequences should also be considered. (AI Summary)
company wants to pay technical fees to director of company who is korean resident. He provide technical guidance/support for the entire operation of the plant from korea only and visit the plant in india only once in a year. Is any tax is required to be paid in india as per Income tax act and considering the provisions of DTAA with korea. Please advise....