Double Taxation Law in India
DOUBLE TAX AVOIDANCE AGGREMENT SECTION 90 OF INCOME TAX
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India has comprehensive Double Taxation Avoidance Agreements (DTAA ) with 79 countries. This means that there are agreed rates of tax and jurisdiction on specified types of income arising in a country to a tax resident of another country. Under the Income Tax Act 1961 of India, there are two provisions, Section 90 and Section 91, which provide specific relief to taxpayers to save them from double taxation. Section 90 is for taxpayers who have paid the tax to a country with which India has signed DTAA, while Section 91 provides relief to tax payers who have paid tax to a country with which India has not signed a DTAA. Thus, India gives relief to both kind of taxpayers.
Under the section 90 of income tax act, the Central Government authorized to act as income tax department to enter into Double tax Avoidance Agreements with other countries. Double tax means if a person is non resident and earns the income from India, this law ensures he/she needs not to pay taxes in both countries. The main aim of this law is to maintain an equitable basis of allocation and differentiate the resident income and non resident income as well as tax treatment and tax rates. This is also known as tax treaties which serve the purpose to protect tax payers against double taxation. It also serves to maintain courage to the businessman and professionals to work worldwide as this is a large market. This law also prevents discrimination between tax payers with a proper fiscal and monetary policy in this law. This law only of mutual understanding between almost all the countries to go and work and your tax will be deduct rationally.
In India the double taxation agreement is unique pattern of what the united nation (UN) has guided. In this agreement allocates jurisdiction between source and the residential country. This law also prescribed the maximum rate of taxation in the source country where the income arises and the maximum
73
India has comprehensive Double Taxation Avoidance Agreements (DTAA ) with 79 countries. This means that there are agreed rates of tax and jurisdiction on specified types of income arising in a country to a tax resident of another country. Under the Income Tax Act 1961 of India, there are two provisions, Section 90 and Section 91, which provide specific relief to taxpayers to save them from double taxation. Section 90 is for taxpayers who have paid the tax to a country with which India has signed DTAA, while Section 91 provides relief to tax payers who have paid tax to a country with which India has not signed a DTAA. Thus, India gives relief to both kind of taxpayers.
Under the section 90 of income tax act, the Central Government authorized to act as income tax department to enter into Double tax Avoidance Agreements with other countries. Double tax means if a person is non resident and earns the income from India, this law ensures he/she needs not to pay taxes in both countries. The main aim of this law is to maintain an equitable basis of allocation and differentiate the resident income and non resident income as well as tax treatment and tax rates. This is also known as tax treaties which serve the purpose to protect tax payers against double taxation. It also serves to maintain courage to the businessman and professionals to work worldwide as this is a large market. This law also prevents discrimination between tax payers with a proper fiscal and monetary policy in this law. This law only of mutual understanding between almost all the countries to go and work and your tax will be deduct rationally.
In India the double taxation agreement is unique pattern of what the united nation (UN) has guided. In this agreement allocates jurisdiction between source and the residential country. This law also prescribed the maximum rate of taxation in the source country where the income arises and the maximum