Tax on Dividends, Interest Royalty and Fees for Technical Service in the case of Non-Corporate Non-Residents and Foreign Companies – Section 115A - International Taxation - Income Tax

Tax on Dividends, Interest, Royalty and Fees for Technical Service in the case of Non-Corporate Non-Residents and Foreign Companies Section 115A Nature of Income Rate of Tax Where the total income of a non-resident (not being a company) or a foreign company includes any income by way of:- (i) Dividends except the amount of income-tax calculated on the amount of income by way of dividend received from a Unit in an International Financial Services Centre, as referred to in section 80LA(1A) , shall be 10%. 20% (ii) Interest received from Government or Indian concern on money borrowed by Government/ Indian concern in foreign currency other than referred to in (iii) and (iv) below. 20% (iii) Interest received from an infrastructure debt fund referred u/s 10(47) 5% (iv) Interest of the nature and extent referred u/s 194LC received from an Indian Company or Business Trust- In respect of monies borrowed by an Indian Company or Business Trust in foreign currency from source outside India Under a loan agreement between 1.7.2012 and 30.06.2023 or By way of issue of long-term infrastructure bonds between 07.07.2012 and 30.09.2014 or By way of issue of long-term bonds including ling term infrastructure bond between 1.10.2014 and 30.6.2023 As approved by Central Government In respect of monies borrowed from source outside India by way of rupee denominated bond on or before 30.6.2023 In respect of monies borrowed by it from source outside India by way of issue of any long term bond or rupee denominated bond between 1.4.2020 and 30.6.2023, which is listed only on a recognised stock exchange located in any, International Financial Services Centre. 5% 4% (v) Interest of the nature and extent referred in section 194LD 5% (vi) distributed income being interest referred u/s 194LBA(2) , Interest Income of a business trust from a SPV, distributed by business trust to its non-resident unit holders Dividend income of a business trust received or receivable from a SPV exercising the option to pay tax at concessional rate under 115BAA, distributed by business trust to its non-resident unit holders However, if the SPV has not exercised the option to pay tax at concessional rate under section 115BAA , dividend income would be exempt in the hands of unit holders 5% 10% (vii) Interest to Foreign Institutional Investor or Qualified Foreign Investor payable between 1.6.2013 and 30.6.2023 on investment made in Rupee denominated bond of an Indian Company Government Security Payable between 1.4.2020 and 30.6.2023 on investment made in municipal debt security 5% (viii) income received in respect of units, purchased in foreign currency, of a Mutual Fund specified u/s 10(23D) or of the Unit Trust of India 20% Where the total income of a non-resident (not being a company) or a foreign company includes any income by way of royalty or fees for technical service other than referred u/s 44DA(1) received from Govt. or an Indian concern in pursuance of an agreement by non-resident /or foreign company, the income tax shall be chargeable by following rates:- (i) amount of income-tax calculated on the income by way of royalty 10% (ii) amount of income-tax calculated on the income by way of fees for technical services 10% Notes:- No deduction of any expense or allowance shall be allowed to the assessee u/s 28 to 44C and section 57 in computing his income referred to in section 115A(1) . No deduction under chapter VI A from such income except in case of income by way of royalty and fee for technical services Deduction under chapter - VIA shall be allowed from the gross total income after deducting income by way of dividend or interest referred to in section 115A(1)(a) . No return of income is necessary It shall not be necessary for an assessee to furnish return u/s 139(1) if:- the total income of the assessee consist only of such dividend and interest mentioned in clause (a) and TDS has been deducted from such income. Set off carry forward and set off of losses allowed from incomes mentioned u/s 115A but unabsorbed depreciation not allowed Explanations:- Fees for technical services shall have the same meaning as in Explanation 2 u/s 9(1)(vii) Foreign currency shall have the same meaning as in the Explanation below item ( g ) u/s 10(15)(iv ) Royalty shall have the same meaning as in Explanation 2 u/s 9(1)(vi) Unit Trust of India means the Unit Trust of India established under the Unit Trust of India Act, 1963