Article 1 - Personal Scope - Czech Republic

Czech Republic SYNTHESISED TEXT OF THE MULTILATERAL CONVENTION TO IMPLEMENT TAX TREATY RELATED MEASURES TO PREVENT BASE EROSION AND PROFIT SHIFTING (MLI) AND THE CONVENTION BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE CZECH REPUBLIC FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND ON CAPITAL This document was prepared by the competent authority of India and the modifications to be brought in by the MLI to India-Czech Republic DTAC were discussed with the competent authority of Czech Republic. This document presents the synthesised text for the application of the Convention between the Government of the Republic of India and the Government of the Czech Republic for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital signed on 1st October, 1998 (the Convention ), as modified by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting signed by the India and Czech Republic on 7th June, 2017 (the MLI ). The document was prepared on the basis of the MLI position of India submitted to the Depositary upon ratification on 25th June, 2019 and of the MLI position of Czech Republic submitted to the Depositary upon ratification on 13th May, 2020. These MLI positions are subject to modifications as provided in the MLI. Modifications made to MLI positions could modify the effects of the MLI on the Convention. The authentic legal texts of the Convention and the MLI take precedence and remain the legal texts applicable. The provisions of the MLI that are applicable with respect to the provisions of the Convention are included in boxes throughout the text of this document in the context of the relevant provisions of the Convention. The boxes containing the provisions of the MLI have generally been inserted in accordance with the ordering of the provisions of the Convention. Changes to the text of the provisions of the MLI have been made to conform the terminology used in the MLI to the terminology used in the Convention (such as Covered Tax Agreement and Convention , Contracting Jurisdictions and Contracting States ), to ease the comprehension of the provisions of the MLI. The changes in terminology are intended to increase the readability of the document and are not intended to change the substance of the provisions of the MLI. Similarly, changes have been made to parts of provisions of the MLI that describe existing provisions of the Convention: descriptive language has been replaced by legal references of the existing provisions to ease the readability. In all cases, references made to the provisions of the Convention or to the Convention must be understood as referring to the Convention as modified by the provisions of the MLI, provided such provisions of the MLI have taken effect. References: The authentic legal text of the MLI (in English) can be found on the MLI Depository (OECD) webpage at the following link: http://www.oecd.org/tax/treaties/multilateral-convention-to-implement-tax-treaty-related-measures-to-prevent-BEPS.pdf The authentic legal texts of the Convention (in English) can be found at the following link: In India: https://www.incometaxindia.gov.in/Pages/international-taxation/dtaa.aspx In Czech Republic: http://aplikace.mvcr.cz/sbirka-zakonu/ViewFile.aspx?type=c id=3316 The MLI position of India submitted to the Depositary upon ratification on 25th June, 2019 and the MLI position of Czech Republic submitted to the Depositary upon ratification on 13th May, 2020 can be found on the MLI Depositary (OECD) webpage. Entry into Force and effect of the MLI Provisions: The provisions of the MLI applicable to the Convention do not take effect on the same dates as the original provisions of the Convention. Each of provisions of the MLI could take effect on different dates, depending on the types of taxes involved (taxes withheld at source or other taxes levied) and on the choices made by India and Czech Republic in their MLI positions. Dates of the deposit of instruments of ratification: 25th June, 2019 for India and 13th May, 2020 for Czech Republic. Entry into force of the MLI: 1st October, 2019 for India and 1st September, 2020 for Czech Republic. Unless it is stated otherwise elsewhere in this document, the provisions of the MLI have effect with respect to the Convention: In India: ➢ With respect to taxes withheld at source on amounts paid or credited to non-residents, where the event giving rise to such taxes occurs on or after 1st April, 2021; and ➢ With respect to all other taxes levied by India, for taxes levied with respect to taxable periods beginning on or after 1st April, 2021. In Czech Republic: ➢ With respect to taxes withheld at source on amounts paid or credited to non-residents, where the event giving rise to such taxes occurs on or after 1st January, 2021; and ➢ With respect to all other taxes levied by Czech Republic, for taxes levied with respect to taxable periods beginning on or after 1st March, 2021. CONVENTION BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE CZECH REPUBLIC FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND ON CAPITAL The Government of the Republic of India and the Government of the Czech Republic desiring to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital and with a view to promoting economic cooperation between the two countries, The following paragraph 1 of Article 6 of the MLI is included in the preamble of this Convention: ARTICLE 6 OF THE MLI- PURPOSE OF A COVERED TAX AGREEMENT Intending to eliminate double taxation with respect to the taxes covered by this [Convention] [1] without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty-shopping arrangements aimed at obtaining reliefs provided in this [Convention] for the indirect benefit of residents of third jurisdictions), have agreed as follows: ARTICLE 1 PERSONAL SCOPE This Convention shall apply to persons who are residents of one or both of the Contracting States. FOOTNOTES:- 1 . The texts of the boxes in [Square brackets] and in italics indicate minor terminology changes made to the text of the MLI.