TMI BlogAgreement for avoidance of Double Taxation between the Govt. of India and the Govt. of SingaporeX X X X Extracts X X X X X X X X Extracts X X X X ..... nd the prevention of fiscal evasion with respect to taxes on income. The Government of the Republic of India and the Government of the the Republic of Singapore. DESIRING to conclude an Agreement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, HAVE AGREED as follows: CHAPTER I Scope of the Agreement ARTICLE 1 Personal Scope This Agreement shall apply to persons who are resident 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: (i) the income-tax and any surcharge on income-tax imposed under the Income-tax Act, 1961 (43 of 1961); (ii) the surtax imposed under the Companies (Profits) Surtax Act, 1964 (7 of 1964); (hereinafter referred to as " Indian tax "). (b) in the case of Singapore: the income-tax (hereinafter referred to as " Singapore tax "). 2. This agreement shall also apply to any identical or substantially similar taxes which are subsequently imposed in addition to, or in place of, the taxes referred to in paragraph 1 of this Article. 3. The competent authorities of the Cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him. If he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer; (b) if the Contracting State with which his personal and economic relations are closer cannot be determined, or if he has not a permanent home available to him in either Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; (c) if he has an habitual abode in both Contracting States or in neither of them, the competent authorities of the Contracting States shall determine the question by mutual agreement. Where by reason of the provisions of paragraph 1 of this Article, a person other than an individual is a resident of both Contracting States, then it shall be deemed to be a resident of the Contracting State in which its place of effective management is situated. ARTICLE 5 Permanent Establishment 1. For the purposes of this Agreement, the term " permanent establishment " means a fixed place of business in whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Contracting State for or on behalf of an enterprise of the other Contracting State shall be deemed to be a permanent establishment of that enterprise in the first-mentioned State if: (i) he has, and habitually exercises in that State, an authority to conclude contracts for or on behalf of the enterprise, unless the activities of the persons are limited to the purchase of goods or merchandise for the enterprise; or (ii) he maintains in the first-mentioned Contracting State a stock of goods or merchandise belonging to the enterprise from which he regularly fills orders for or on behalf of the enterprise; or (iii) he habitually secures orders in the first-mentioned Contracting State exclusively or almost exclusively, for the enterprise or any other enterprise which is controlled by it or has a controlling interest in it. 6. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other Contracting State through a broker, a general commission agent or any other agent of an independent status, where such persons are acting in the ordinary course of their business. 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or similar activities under the same or similar conditions and deal wholly and independently with the enterprise of which it is a permanent establishment. In any case, where the correct amount of profits attributable to a permanent establishment is incapable of determination or the ascertainment thereof presents exceptional difficulties, the profits attributable to the permanent establishment may be estimated on a reasonable basis. 3. In the determination of the income or profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. 4. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. 5. For the purpose of this Article, the term " income or profits " means income derived by an enterprise from the conduct of a trade or business; but does not include income derived by an enterprise in the form of rents, royalties, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k or goods shipped in that other Contracting State. 3. Paragraph 1 shall not apply to profits arising as a result of coastal traffic. ARTICLE 10 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 income or profits 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 income or profits of that enterprise and taxed accordingly. ARTICLE 11 Dividends 1. Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in the first-mentioned Contracting State. 2. Where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or not, has in a Contracting State a permanent establishment in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment, then such interest shall be deemed to arise in the Contracting State in which the permanent establishment is situated. 3. Where, owing to a special relationship between the payer and the recipient 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 recipient 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. 4. The term " interest " as used in this Article means income from Government securities, bonds or debentures, whether or not secured by mortgage and whether or not carrying a right to participate in profits and debt-claims of every kind as well as all other income assimilated to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that Contracting State unless the employment is exercised in the other Contracting State. If the employment is so exercised such remuneration as is derived therefrom may be taxed in that other Contracting State. 2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of Singapore in respect of an employment exercised in India shall not be taxed in India if: (a) he is present in India for a period or periods not exceeding in the aggregate 183 days during the " previous year " concerned; and (b) the remuneration is paid by, or on behalf of an employer who is a resident of Singapore; (c) the remuneration is not borne by a permanent establishment which the employer has in India. 3. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of India in respect of an employment exercised in Singapore shall not be taxed in Singapore if: (a) he is present in Singapore for a period or periods not exceeding in the aggregate 183 days during the calendar year concerned; and (b) the remuneration is paid by, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of time, under an obligation to make the payments in return for adequate and full consideration in money or money's worth. ARTICLE 18 Governmental Functions 1. Remuneration or pensions paid by, or out of funds, created by a Contracting State, or a political sub-division or a local or statutory authority thereof, to any individual in respect of services rendered to that State or political sub-division or local or statutory authority in discharge of functions of a governmental nature shall be taxable only in that Contracting State. If, however, the employment is exercised in the other Contracting State by a resident of that other State not being a citizen or national of the first-mentioned State, the remuneration shall be taxable only in that other State. 2. The provisions of paragraph 1 of this Article shall also apply to remuneration or pensions paid by the Reserve Bank of India and the Monetary Authority of Singapore. 3. Save as provided in paragraph 2, the provisions of this Article shall not apply to payments in respect of services in connection with any trade or business carried on by either of the Contracting States or political sub-division or a local authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xperience from a person other than such enterprise, for a period not exceeding twelve months from the date of his first arrival in that other Contracting State in connection with that visit shall be exempt from tax in that other Contracting State on- (a) all remittances from the first-mentioned Contracting State for the purposes of his maintenance, education or training; and (b) any remuneration, so far as it is not in excess of 12,500 Indian Rupees or its equivalent sum in Singapore currency per annum, for personal services rendered in that other Contracting State, provided such services are in connection with the acquisition of such experience. 4. An individual who is a resident of a Contracting State and who is temporarily present in the other Contracting State under arrangement with the Government of that other Contracting State solely for the purpose of training or study shall be exempt from tax in that other Contracting State in respect of remuneration received by him on account of such training or study. 5. For the purposes of this Article and Article 20- (a) (i) an individual shall be deemed to be a resident of India if he is resident in India in the " previous ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Agreement may be taxed in accordance with the taxation laws of the respective Contracting States. ARTICLE 23 Limitation of Relief Where this Agreement provides (with or without other conditions) that income from sources in a Contracting State shall be exempt from tax, or taxed at a reduced rate in that Contracting State and under the laws in force in the other Contracting State the said income is subject to tax by reference to the amount thereof which is remitted to or received in that other Contracting State and not by reference to the full amount thereof, then the exemption or reduction of tax to be allowed under this Agreement in the first-mentioned Contracting State shall apply to so much of the income as is remitted to or received in that other Contracting State. CHAPTER IV Method for Elimination of Double Taxation ARTICLE 24 Avoidance of Double Taxation 1. The laws in force in either of the Contracting States will continue to govern the taxation of income in the respective Contracting States except where provisions to the contrary are made in this Agreement. Where income is subject to tax in both Contracting States, relief from double taxatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome or an exemption or reduction of tax granted for that year under:- (i) sections 10(4), 10(4A), 10(15)(iv), 32A, 33A, 35C, 54E, 80CC, 80HH, 80J and 80K of the Income-tax Act, 1961 (43 of 1961), so far as they were in force and have not been modified since the date of signature of this Agreement, or have been modified in minor respects so as not to affect their general character. (ii) any other provisions which may subsequently be made granting an exemption or reduction from tax which is agreed by the competent authorities of the Contracting States to be of a substantially similar character, if it has not been modified thereafter or has been modified in minor respects so as not to affect its general character. CHAPTER V Special Provisions ARTICLE 25 Non-discrimination 1. Nationals or citizens of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which nationals or citizens of that other Contracting State in the same circumstances and under the same conditions are or may be subjected. This provision s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se must be presented within three years from the date of the assessment or of the withholding of tax at the source, whichever is later. 2. The competent authority shall endeavour, if the objection appears to it 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 not in accordance with the Agreement. Any agreement reached shall be implemented notwithstanding any time limits in the national laws of the Contracting States. 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 this Agreement. They may also consult together for the elimination of double taxation in cases not provided for in this Agreement. 4. The competent authorities of the Contracting States may communicate with each other directly for the purposes of applying the provisions of this Agreement. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of income assessable for the assessment year commencing on the 1st day of April in the second calendar year following the calendar year in which the notice is given and the subsequent assessment years. (b) in Singapore, in respect of income assessable for the year of assessment commencing on the 1st day of January in the second calendar year following the calendar year in which the notice is given and the subsequent years of assessment. In witness whereof the undersigned, being duly authorised thereto, have signed the present Agreement. Done in duplicate at Singapore this 20th day of April of the year one thousand nine hundred and eighty-one in the English language. Sd/- B. M. Oza Sd/- Hsu Tse-Kwang For the Govt. of India For the Govt. of Singapore [F. No. 11/31/69-FTD] - Notification Tax Management India - taxmanagementindia - taxmanagement - taxmanagemen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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