Article 23 - Elimination of Double Taxation - Austria

ARTICLE 23 ELIMINATION OF DOUBLE TAXATION 1. The laws in force in either of the Contracting States shall continue to govern the taxation of income in the respective Contracting State except where express provision to the contrary is made in this Convention. 2. In the case of Austria, double taxation shall be eliminated as follows: (a) Where a resident of Austria derives income which, in accordance with the provisions of this Convention, may be taxed in India, Austria shall, subject to the provisions of sub-paragraphs (b) and (c) exempt such income from tax. [1] (b) Where a resident of Austria derives items of income which, in accordance with the provisions of paragraph 2 of Articles 10, 11, 12, paragraphs 4 and 5 of Article 13 and paragraph 3 of Article 22 may be taxed in India, Austria shall allow as a deduction from the tax on the income of that resident an amount equal to the tax paid in India. Such deduction shall not, however, exceed that part of the tax, as computed before the deduction is given, which is attributable to such items of income derived from India. (c) Where in accordance with any provision of the Convention income derived by a resident of Austria is exempt from tax in Austria, Austria may nevertheless, in calculating the amount of tax on the remaining income of such resident, take into account the exempted income. 3. In the case of India, double taxation shall be eliminated as follows: (a) Where a resident of India derives income which, in accordance with the provisions of this Convention, may be taxed in Austria, India shall allow as a deduction from the tax on the income of that resident an amount equal to the income-tax paid in Austria whether directly or by deduction at source. Such amount shall not, however, exceed that part of income-tax, as computed before the deduction is given, which is attributable to the income which may be taxed in Austria. (b) Where, in accordance with any provision of this Convention, income derived by a resident of India is exempt from tax in India, India may nevertheless, in calculating the amount of tax on the remaining income of such resident, take into account the exempted income. FOOTNOTES:- 1 . India understands that in Austrian version of synthesised text paragraph 2 of Article 5 of the MLI applies to subparagraph ( a ) of paragraph 2 of Article 23 of the Convention with respect to the residents of Austria as under: The following paragraph 2 of Article 5 of the MLI applies to subparagraph ( a ) of paragraph 2 of Article 23 of this Convention with respect to the residents of Austria: ARTICLE 5 OF THE MLI APPLICATION OF METHODS FOR ELIMINATION OF DOUBLE Subparagraph a) of paragraph 2 of Article 23 of this Convention shall not apply where India applies the provisions of this Convention to exempt such income from tax or to limit the rate at which such income may be taxed. In the latter case, Austria shall allow as a deduction from the tax on the income of that resident an amount equal to the tax paid in India. Such deduction shall not, however, exceed that part of the tax, as computed before the deduction is given, which is attributable to such items of income or capital which may be taxed in India. ]