Double taxation agreement: Between India and USSR signed - PRESS NOTE - Income Tax

Permanent establishment rules determine taxation of cross border business profits, with source concessions and credit relief.

The treaty allocates taxing rights so business profits are taxable in the other state only if a permanent establishment exists; exempts international aircraft profits and provides specified source exemptions and limits for shipping profits; subjects dividends, interest, royalties and technical fees to concessional source rates; prescribes that India will relieve double taxation by the credit method while the other state will eliminate double taxation under its law taking into account taxes paid or spared in India; entry into force follows completion of domestic formalities.