TaxTMI 
TaxTMI 
Agreement between the Government of the Republic of India and the Government of the Republic of India and the Government of the Swiss Confederation or avoidance for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes
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.... THE REPUBLIC OF INDIA AND THE SWISS CONFEDERATION FOR THE AVOIDENCE OF DOUBLE TAXATION WITH RESPECT TO TAXES ON INCOME THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE SWISS FEDERAL COUNCIL DESIRING to conclude in Agreement for the avoidance of double taxation with respect to taxes on income, HAVE AGREED as follows: ARTICLE 1 PERSONAL SCOPE This Agreement shall apply to persons who are residents of one or both of the Contracting States. ARTICLE 2 TAXES COVERED 1. The taxes to which this Agreement shall apply are: (a) In the case of India: the income tax including any surcharge thereon; and (b) In the case of Switzerland: the federal, cantonal and communal taxes on income (total income earned income form capital, industrial and commercial profits, capital gains, and other items of income). 2. The Agreement shall also apply to any identical or substantially similar taxes which are imposed by either Contracting State after the date of Signature of the present Agreement in addition to or in place of the taxes referred to in paragraph 1 of this Article. 3. In this Agreement the term "Indian tax" means tax imposed by India being tax to which this Agree....
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....ther Contracting State; (j) the term "operation of aircraft" shall mean business of transportation by air of passengers, mail, livestock or goods carried on by the owners or lessees or charteres of aircraft, including the sale of tickets for such transportation on behalf of other enterprises the incidental lease of aircraft connected with such transportation; (k) the term "fiscal year" means; (i) in the case of India, the "previous year" as defined in the Income-tax Act of India; and (ii) in the case of Switzerland, the calendar year. 2. In the application of the provisions of this Agreement by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the laws in force in that State relating to the taxes which are the subject of this Agreement. ARTICLE 4 FISCAL DOMICILE 1. For the purposes of this Agreement, the term "resident of a Contracting State" means any person who, under the laws of that State, is liable to taxation therein by reason of his domicile, residence, place of incorporation, place of management or any other criterion of a similar nature. 2.....
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....s for more than 90 days; and (l) the furnishing of technical services, other than services as defined in Article 12, within a Contracting State by an enterprise through employees or other personnel, but only if:-- (i) activities of that nature continue within that State for a period or periods aggregating more than 90 days within any twelve month period; or (ii) the services are performed within that State for a related enterprise (within the meaning of paragraph 1 of Article 9) for a period or periods aggregating more than 30 days within any twelve-month period. 3. the term "permanent establishment" shall not be deemed to include : (a) the use of facilities solely for the purpose of storage or display of goods or merchandise belonging to the enterprise; (b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage or display; (c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise; (d) the maintenance of a fixed place of business solely for the purpose of purchasing goods or merchandise or for collecting information, ....
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....hich such property is situated 2. The term "immovable property" shall be defined in accordance with the law of the Contracting State in which the property is situated. The term shall in any case include property accessory to immovable property, livestock and equipment used in agriculture and forestry, rights to which the provisions of general law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, oilwells, quarries and other places of extraction of natural resources. Ships and aircraft shall not be regarded as immovable property. 3. The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of immovable property. 4. The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of an enterprise, and to income from immovable property used for the performance of professional services. ARTICLE 7 BUSINESS PROFITS 1. The business profits of an enterprise of a Contracting State, other than the profits from the operation of ships in international traffic, shal....
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....aft in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated. 2. The provisions of paragraph 1 shall also apply to profits from participation in a pool, a joint business or an international operating agency. ARTICLE 9 ASSOCIATED ENTERPRISES Where: (a) an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State; or (b) the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and an enterprise of the other Contracting State, and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profit which would, but for those conditions, have accrued to one of the enterprises, but, by reason of those conditions, have not so accrued, may be included in the profits of that enterprise and taxed accordingly. ARTICLE 10 DIVIDENDS 1. Dividends paid by a company which is a resident of a C....
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....eficial owner of the interest the tax so charged shall not exceed 15 per cent of the gross amount of interest. 3. Notwithstanding the provisions of paragraph 2, where the interest is paid to a bank carrying on a bona fide banking business or to an enterprise which holds directly or indirectly at least 20 per cent of the capital of the company paying the interest which are a resident of the other Contracting State and are the beneficial owner of the interest the tax so charged in the Contracting State in which the interest arises shall not exceed 10 per cent of the gross amount of the interest. 4. Notwithstanding the provisions of paragraphs 2 and 3 : (a) interest arising in Switzerland and paid to a resident of India shall be taxable only in India if it is paid in respect of a loan made, guaranteed or insured, or a credit extended, guaranteed or insured by the Export-Import Bank of India or by any institution specified and agreed in letters exchanged between the competent authorities of the Contracting States; (b) interest arising in India and paid to a resident of Switzerland shall be taxable only in Switzerland if it is paid in respect of a loan made, guaranteed or insured,....
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....to a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest paid, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. 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 Agreement ARTICLE 12 ROYALTIES AND FEES FOR INCLUDED SERVICES 1. Royalties and fees for included services arising in a Contracting state and pa d to a resident of the other Contracting State may be taxed in that other State. 2. However, such royalties and fees for included 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 royalties or fees for included services is a resident of the other Contracting State, the tax so charged shall not exceed: (a) in the case of royalties referred to in sub-paragraph (a) of paragra....
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....graph 3 is received; or (ii) make available technical knowledge, experience, skill, know-how or processes, or consist of the development and transfer of a technical plan or technical design. 5. Notwithstanding paragraph 4, "fees for included services" does not include amounts paid: (a) for services that are ancillary and subsidiary, as well as inextricably and essentially linked, to the sale of property; (b) for teaching in or by educational institutions; (c) for services for the personal use of the individual or individuals making the payment; or (d) to an employee of the person making the payments or to any individuals (other than a company) for professional services falling under article 14. 6. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties or fees for technical services, being a resident of a Contracting State, carries on business in the other Contracting State in which the royalties or fees for included services arise, through a permanent establishment situated therein, and the contract in respect of which the royalties or fees for included services are paid is effectively connected with such permanent establ....
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....lienator is a resident. (b) Notwithstanding the provisions of sub-paragraph (a), India may tax gains from the alienation of shares in a company which is a resident of India. (i) if the shares from part of at least a 10 per cent interest in the capital stock of that company; or (ii) in other cases if the alienation takes place to a resident of that State. In these cases the provisions of paragraph 1, sub-paragraph (b) of Article 21 shall apply, 6. Gains from the alienation of any property other than that referred to in paragraphs 1, 2, 3, 4 and 5, shall be taxable only in the Contracting State of which the alienator is a resident. ARTICLE 14 PERSONAL SERVICES 1. Subject to the provisions of Articles 15, 17, 18, 19 and 20, salaries, wages and other similar remuneration in respect of an employment as well as income in respect of professional of an employment as well as income in respect of professional services or other activities of an independent character, derived by an individual resident of a Contracting State, shall be taxable only in that State, unless the employment services or activities are exercised or performed in the other Contracting State. If the employment se....
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....Any pension (other than a pension referred to in Article 18) or annuity derived by a resident of a Contracting State shall be taxable only in that State. 2. The term "pension" means a periodic payment made in consideration of past employment or by way of compensation for injuries received in the course of the performance of services. 3. The term "annuity" means stated sum payable periodically at stated times, during life or during a specified or ascertainable period of time, under an obligation to make the payments in return for adequate and full consideration in money or money's worth. ARTICLE 18 GOVERNMENT REMUNERATION AND PENSIONS 1. Remuneration, other than a pension, paid by the Government of a Contracting State to any individual who is a citizen of that State in respect of services rendered in the discharge of governmental functions in the other Contracting State shall be taxable only in the first-mentioned State. 2. Any pension paid by the Government of a Contracting State to any individual in respect of services rendered shall be taxable only in that Contracting State. 3. The provisions of paragraphs 1 and 2 of this Article shall not apply to ....
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....ion shall not, however, exceed that part of the income-tax (as computed before the deduction is given) which is attributable to the income which may be taxed in Switzerland. (b) Where a resident of Switzerland derives gains from the alienation of shares which may be taxed in India according to Article 13, paragraph 5, sub-paragraph (b), India shall allow as a deduction from tax on that income, an amount equal to the income-tax paid in Switzerland on these capital gains. The deduction shall not, however, exceed that part of the Indian income-tax, which is imposed on these capital gains. 2. (a) Where a resident of Switzerland derives income which, in accordance with the provisions of this Agreement may be taxed in India, Switzerland shall, subject to the provisions of sub-paragraphs (b), (c) and (d), exempt such income from tax but may, in calculating tax on the remaining income of that resident, apply the rate of tax which would have been applicable, if the exempted income had not been so exempted; provided, however, that such exemption shall apply to gains referred to in paragraph 4 of Article 13 only if actual taxation of such gains in India is demonstrated. (b) Where a residen....
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....sub-paragraph (b) (1); (bb) a deduction of 15 per cent of the gross amount of fees for included services covered by Article 12, paragraph 4, sub-paragraph (b) (ii); C. during the subsequent years for which this Agreement has effect: (aa) a. deduction of 5 per cent of the gross amount of royalties referred to in Article 12, paragraph 2, sub-paragraph (a) (ii) or of fees for included services covered by Article 12, paragraph 4, sub-paragraph (b) (i); (bb) a deduction of 10 per cent of the gross amount of fees for included services covered by Article 12, paragraph 4, sub-paragraph (b) (ii); (ii) a credit from the Swiss tax on the income of that resident, as computed by reference to the relief referred to in the foregoing sub-paragraph of an amount of: A. 10 per cent of the gross amount of the interest referred to in Article 11, paragraph 2; B. 10 per cent of the gross amount of the royalties referred to in Article 12, paragraph 2, sub-paragraph (a), and of the fees for included services covered by Article 12, paragraph 4, sub-paragraph (b) (i); C. 5 per cent of the gross amount of the fees for included services covered by Article 12, paragraph 4, sub-paragraph (b) (ii)....
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.... to be justified and if it is not itself able to arrive at an appropriate solution, to resolve the case by mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation which is not in accordance with the Agreement. 3. The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of the Agreement. They may also consult together for the elimination of double taxation in cases not provided for in the Agreement. 4. The competent authorities of the Contracting States shall settle the limitations provided for in Articles 10, 11 and 12. 5. The competent authorities of the Contracting States may communicate with each other directly for the purpose of reaching an agreement in the sense of the preceding paragraphs. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through a Commission consisting of representatives of the competent authorities of the Contracting States. ARTICLE 24 EXCHANGE OF INFORMATION 1. The competent authorities of the Contracting ....
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....this Agreement become effective in accordance with paragraph 2. 4. The 1958 Agreement shall terminate on the expiration of the last date on which it has effect in accordance with the foregoing provisions of this Article ARTICLE 27 TERMINATION This Agreement shall continue in effect indefinitely but either of the Contracting States may, on or before the thirtieth day of June in any calendar year, give notice of termination to the other Contracting State and, in such event, this Agreement shall cease to be effective : (a) in India, in respect of income arising in any fiscal year beginning on or after the first day of April next following the calendar year in which the notice of termination is given; and (b) in Switzerland, in respect of income arising in any fiscal year beginning on or after the first day of January next following the calendar year in which the notice of termination is given. IN WITNESS WHEREOF the undersigned, being duly authorised thereto, have signed the present Agreement. DONE in duplicate at New Delhi this 2nd day of November, one thousand nine hundred and ninety four in the Hindi, German, and English languages, all the texts being equally authentic, e....
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.... that of the enterprise as a whole. It is also understood that profits shall be regarded as attributable to the permanent establishment to the above - mentioned extent, even when the contracts in question are made directly with the head office of the enterprise rather than with the permanent establishment In the case of contracts for the survey, supply, installation or construction of industrial, commercial or scientific equipment or premises, or of public works, which are carried out by an enterprise having a permanent establishment. In a Contracting State the business profits of such permanent establishment shall not be determined on the basis of the total amount of the contract, but shall be determined only on the basis of that part of the contract which is effectively carried out by the permanent is situated; the profits related to that part of the contract which is carried Out outside that Contracting State by the head office of the enterprise shall be taxable only in the State of which of the enterprise is a resident, provided that the amount payable is not covered under the provisions of Article 12. 3. With reference to Article 10, 11 and 12 It after the signature of this....