CONCESSIONAL RATE OF TAX IN INDIA OF 15% ON DIVIDEND INCOMES AS WELL AS INTEREST INCOMES UNDER DTAA.
Under Article 10 and Article 11 of the India-Australia DTAA (Double Taxation Avoidance Agreement), there is a concessional rate of 15% on dividend income as well as interest income (including NRO bank account interest) respectively, in India for tax residents of Australia. The same shall also be the rate of T.D.S. (withholding tax) in India.
A person is a tax resident of Australia if he stays in Australia for more than 183 days in the Australian tax year (1st July to 30th June) OR on fulfillment of certain other conditions.
The above rates are inclusive of surcharges and cess which is affirmed by the following judicial decisions:
- Deputy Director of Income-tax (IT)-1(1), Kolkata v. BOC Group Ltd.
- R.A.K. Ceramics, UAE v. Deputy Commissioner of Income Tax, International Taxation (2), Hyderabad
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Disclaimer: The above facts are based on our interpretation of law. The same should not be relied or acted upon without seeking specific professional advice.