Double Taxation Benefit
This query is : Resolved
21 October 2007
thanx for reply but tell me please if dere is any double taxation benefit agreement b/w india & london & Dubai..........if is den plz tell me for short term capital gain on equity shares.
21 October 2007
YES GURPREETJI,INDIA HAS DTAA(DOUBLE TAXATION AVOIDANCE AGREEMENT) WITH UK AND UAE( UAE HAS SIX EMIRATES WITHIN- LIKE DUBAI,SHARJAH,ABUDHABI,RAS-AL-KHIMA,ALINE ETC...).IF YOU WISH TO SEE THE DETAILED DTAA WITH THESE COUNTRIES OR ANY COUNTRY WITH WHOM INDIA SIGNED SUCH TREATY,PL. VISIT. www.incometaxindia.gov.in
NRI TAXATION OF SHORT TERM CAPITAL GAINS IS AS FOLLOES as explained yesterday.
1. Short - term Capital Gains on listed Equity shares
where Securities Transaction Tax(stt) is paid
Rate of T.D.S. 11.33%
Rate of INCOME Tax 11.33%
2.if no stt is paid or if not listed
tds is 33.99%
rate of tax is also 33.99%maximum and
Such income is to be clubbed with all other income and tax will be charged as per prescribed rate given below :
Upto Rs. 1,10,000 Nil
Between Rs. 1,10,000 -
Rs. 1,50,000 10% of income in excess of Rs. 1,10,000
Between Rs. 1,50,000 –
Rs. 2,50,000 - 4,000 + 20% of income in excess of Rs. 1,50,000
Above Rs.2,50,000-Rs 10,00,000 24,000 + 30% of income in excess of Rs. 2,50,000
Above Rs 10,00,000 Rs.2,49,000 +'30% of (total Income minus Rs. 2,50,000
SURCHARGE OF 10% of Income Tax AND 3% of Income Tax & Surcharge
surcharge apply above rs. ten lakhs and add 3% ed. cess on income tax payable.
Note:
For Women there is no tax upto Rs.1,45,000 and for senior citizens it is Rs. 1,95,000 /-
PL.REFER TWO WEBSITES FOR NRI TAX ISSUES
WWW.TAXWORRY.COM
WWW.NRITAXSERVICES.COM
R.V.RAO
NRI TAXATION OF SHORT TERM CAPITAL GAINS IS AS FOLLOES as explained yesterday.
1. Short - term Capital Gains on listed Equity shares
where Securities Transaction Tax(stt) is paid
Rate of T.D.S. 11.33%
Rate of INCOME Tax 11.33%
2.if no stt is paid or if not listed
tds is 33.99%
rate of tax is also 33.99%maximum and
Such income is to be clubbed with all other income and tax will be charged as per prescribed rate given below :
Upto Rs. 1,10,000 Nil
Between Rs. 1,10,000 -
Rs. 1,50,000 10% of income in excess of Rs. 1,10,000
Between Rs. 1,50,000 –
Rs. 2,50,000 - 4,000 + 20% of income in excess of Rs. 1,50,000
Above Rs.2,50,000-Rs 10,00,000 24,000 + 30% of income in excess of Rs. 2,50,000
Above Rs 10,00,000 Rs.2,49,000 +'30% of (total Income minus Rs. 2,50,000
SURCHARGE OF 10% of Income Tax AND 3% of Income Tax & Surcharge
surcharge apply above rs. ten lakhs and add 3% ed. cess on income tax payable.
Note:
For Women there is no tax upto Rs.1,45,000 and for senior citizens it is Rs. 1,95,000 /-
PL.REFER TWO WEBSITES FOR NRI TAX ISSUES
WWW.TAXWORRY.COM
WWW.NRITAXSERVICES.COM
R.V.RAO
21 October 2007
gurpreetji,
dtaa iam afraid is not relevant for applicability in case of capital gains.tds applicability is there as you know. but how can nri benefit by taking set off route or exemption route is given below.
SET-OFF OF GAINS AGAINST LOSSES:
When NRI has incurred loss on sale of shares and later when he sells other shares where he has capital gains, in such a case the NRI is eligible to claim set off provided both the transactions are in the same year i.e. during April- March financial year. In this case, NRI can apply for Tax Exemption Certificate prior to the sale of shares of second lot where he has capital gains to ensure set –off and Nil or lower deduction of tax .If the loss cannot be set off or entirely be setoff in the same year, it is allowed to be carried forward to subsequent year provided return of income is filled within the prescribed time limit.
dtaa provisions in general where you an nri can take benefit are explained below for your information and also of all our ca club members.
The Double Tax Avoidance Agreements (DTAA) are essentially bilateral agreements entered into between two countries, in our case, between India and another foreign state. The basic objective is to promote and foster economic trade and investment between two countries by avoiding double taxation.
The advantage of DTAA are as under,
Lower Withholding Taxes
Complete Exemption of Income from Taxes
Underlying Tax Credits
Tax Sparing Credits
Determination of Residential Status
The Provisions of DTAA override the general provisions of taxing statue of a particular country. It is now well settled that in India the provisions of the DTAA override the provisions of the domestic statute. Moreover, with the insertion of Sec.90 (2) in the Indian Income Tax Act, it is clear that assessee have an option of choosing to be governed either by the provisions of particular DTAA or the provisions of the Income Tax Act, whichever are more beneficial.
The NRI can certainly take the benefit of the provisions of DTAA entered into between India and the country in which the he resides, more particularly in respect of Interest Income from NRO account, Government securities, Loans, Fixed Deposits with Companies and dividends etc. This is explained here under: -
For the Assessment Year 2003-2004,
Withholding Tax Rate under Indian Income Tax for Interest Income - 31.5% whereas,
Rate of Tax prescribed in the DTAA with the country where NRI resides e.g. Singapore - 15%
Therefore, chargeable rate will be 15%(Lower of the Two)
Every NRI should choose lower of the tax rate prescribed in DTAA with the country where he resides and the tax rate prescribed under the Indian tax laws.
( SOURCE:www.nritaxservices.com)
R.V.RAO
dtaa iam afraid is not relevant for applicability in case of capital gains.tds applicability is there as you know. but how can nri benefit by taking set off route or exemption route is given below.
SET-OFF OF GAINS AGAINST LOSSES:
When NRI has incurred loss on sale of shares and later when he sells other shares where he has capital gains, in such a case the NRI is eligible to claim set off provided both the transactions are in the same year i.e. during April- March financial year. In this case, NRI can apply for Tax Exemption Certificate prior to the sale of shares of second lot where he has capital gains to ensure set –off and Nil or lower deduction of tax .If the loss cannot be set off or entirely be setoff in the same year, it is allowed to be carried forward to subsequent year provided return of income is filled within the prescribed time limit.
dtaa provisions in general where you an nri can take benefit are explained below for your information and also of all our ca club members.
The Double Tax Avoidance Agreements (DTAA) are essentially bilateral agreements entered into between two countries, in our case, between India and another foreign state. The basic objective is to promote and foster economic trade and investment between two countries by avoiding double taxation.
The advantage of DTAA are as under,
Lower Withholding Taxes
Complete Exemption of Income from Taxes
Underlying Tax Credits
Tax Sparing Credits
Determination of Residential Status
The Provisions of DTAA override the general provisions of taxing statue of a particular country. It is now well settled that in India the provisions of the DTAA override the provisions of the domestic statute. Moreover, with the insertion of Sec.90 (2) in the Indian Income Tax Act, it is clear that assessee have an option of choosing to be governed either by the provisions of particular DTAA or the provisions of the Income Tax Act, whichever are more beneficial.
The NRI can certainly take the benefit of the provisions of DTAA entered into between India and the country in which the he resides, more particularly in respect of Interest Income from NRO account, Government securities, Loans, Fixed Deposits with Companies and dividends etc. This is explained here under: -
For the Assessment Year 2003-2004,
Withholding Tax Rate under Indian Income Tax for Interest Income - 31.5% whereas,
Rate of Tax prescribed in the DTAA with the country where NRI resides e.g. Singapore - 15%
Therefore, chargeable rate will be 15%(Lower of the Two)
Every NRI should choose lower of the tax rate prescribed in DTAA with the country where he resides and the tax rate prescribed under the Indian tax laws.
( SOURCE:www.nritaxservices.com)
R.V.RAO
01 November 2007
yes, i fully support the views of Sri.R.V.Rao.
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