Hello,
My doubt is related to "Double Taxation Avoidance Agreement" My client has earned salary in India worth Rs 25L for 8 months during the FY 2016-17 (TDS Rs. 5.75L). He has also earned salary in Belgium of Rs 10L for 4 months for the same financial year.(Tax Deducted Rs 3L). India has entered into an ahgreement with Belgium.
Now, my client is an Indian resident. Thus his global as well as Indian income (20+10) will be taxable in India. Can I take full credit of Rs 3L u/s 90, which is the tax paid in Belgium? And Is it necessary to apply for TRC (tax Residence Certificate)?
As per DTAA with Belgium (Article 15)
DEPENDENT PERSONAL SERVICES
1. Subject to the provisions of Articles 16, 17, 18, 19, 20 and 21, salaries, wages and other
similar remuneration derived by a resident of a Contracting State in respect of an
employment shall be taxable only in that State unless the employment is exercised in the
other Contracting State. If the employment is so exercised, such remuneration as is
derived there from may be taxed in that other State.
2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a
Contracting State in respect of an employment exercised in the other Contracting State
shall be taxable only in the first-mentioned State if:--
a. the recipient is present in the other State for a period or periods not exceeding in
the aggregate 183 days in the relevant "previous year" or "taxable period", as the
case may be;
b. the remuneration is paid by, or on behalf of, an employer who is not a resident of
the other State; and
c. the remuneration is not deductible in computing the profits or income of a
permanent establishment or a fixed base which the employer has in the other
State.
Please guide me.
Thank you in advance.
CAclubindia
