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TMI BlogAgreement for avoidance of Double Taxation between the Govt. of India and the Govt. of SingaporeX X X X Extracts X X X X X X X X Extracts X X X X ..... h respect to taxes on income. The Government of the Republic of India and the Government of the the Republic of Singapore. DESIRING to conclude an Agreement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, HAVE AGREED as follows: CHAPTER I Scope of the Agreement ARTICLE 1 Personal Scope This Agreement shall apply to persons who are resident of one or both of the Contracting States. ARTICLE 2 Taxes covered 1. The taxes to which this Agreement shall apply are: (a) in the case of India: (i) the income-tax and any surcharge on income-tax imposed under the Income-tax Act, 1961 (43 of 1961); (ii) the surtax imposed under the Companies (Profits) Surtax Act, 1964 (7 of 1964); (hereinafter referred to as " Indian tax "). (b) in the case of Singapore: the income-tax (hereinafter referred to as " Singapore tax "). 2. This agreement shall also apply to any identical or substantially similar taxes which are subsequently imposed in addition to, or in place of, the taxes referred to in paragraph 1 of this Article. 3. The competent authorities of the Contracting States shall notify to each other, within reasonable time, an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to him. If he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer; (b) if the Contracting State with which his personal and economic relations are closer cannot be determined, or if he has not a permanent home available to him in either Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; (c) if he has an habitual abode in both Contracting States or in neither of them, the competent authorities of the Contracting States shall determine the question by mutual agreement. Where by reason of the provisions of paragraph 1 of this Article, a person other than an individual is a resident of both Contracting States, then it shall be deemed to be a resident of the Contracting State in which its place of effective management is situated. ARTICLE 5 Permanent Establishment 1. For the purposes of this Agreement, the term " permanent establishment " means a fixed place of business in which the business of the enterprise is wholly or partly carried on. 2. The term " permanent establishment " sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of that enterprise in the first-mentioned State if: (i) he has, and habitually exercises in that State, an authority to conclude contracts for or on behalf of the enterprise, unless the activities of the persons are limited to the purchase of goods or merchandise for the enterprise; or (ii) he maintains in the first-mentioned Contracting State a stock of goods or merchandise belonging to the enterprise from which he regularly fills orders for or on behalf of the enterprise; or (iii) he habitually secures orders in the first-mentioned Contracting State exclusively or almost exclusively, for the enterprise or any other enterprise which is controlled by it or has a controlling interest in it. 6. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other Contracting State through a broker, a general commission agent or any other agent of an independent status, where such persons are acting in the ordinary course of their business. 7. The fact that a company which is a resident of a Contracting State controls or is controlled by a company which is a resident of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n any case, where the correct amount of profits attributable to a permanent establishment is incapable of determination or the ascertainment thereof presents exceptional difficulties, the profits attributable to the permanent establishment may be estimated on a reasonable basis. 3. In the determination of the income or profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. 4. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. 5. For the purpose of this Article, the term " income or profits " means income derived by an enterprise from the conduct of a trade or business; but does not include income derived by an enterprise in the form of rents, royalties, technical service fees, interest, dividends, capital gains, fees for the management of the business of another enterprise, or remuneration or fees received by a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State, or (b) the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and an enterprise of the other Contracting State. and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any income or profits which would, but for those conditions, have accrued to one of the enterprises, but by reason of those conditions, have not so accrued may be included in the income or profits of that enterprise and taxed accordingly. ARTICLE 11 Dividends 1. Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in the first-mentioned Contracting State. 2. Where a company which is a resident of a Contracting State derives income or profits from the other Contracting State that other Contracting State may not impose any tax on the dividends paid by the comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen such interest shall be deemed to arise in the Contracting State in which the permanent establishment is situated. 3. Where, owing to a special relationship between the payer and the recipient or between both of them and some other person, the amount of the interest paid, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the recipient in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. In that case, the excess part of the payments shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Agreement. 4. The term " interest " as used in this Article means income from Government securities, bonds or debentures, whether or not secured by mortgage and whether or not carrying a right to participate in profits and debt-claims of every kind as well as all other income assimilated to income from money lent by the taxation law of the Contracting State in which the income arises. ARTICLE 13 Royalties 1. Royalties arising in a Contracting State and paid to a resident of the other Contracti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment is so exercised such remuneration as is derived therefrom may be taxed in that other Contracting State. 2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of Singapore in respect of an employment exercised in India shall not be taxed in India if: (a) he is present in India for a period or periods not exceeding in the aggregate 183 days during the " previous year " concerned; and (b) the remuneration is paid by, or on behalf of an employer who is a resident of Singapore; (c) the remuneration is not borne by a permanent establishment which the employer has in India. 3. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of India in respect of an employment exercised in Singapore shall not be taxed in Singapore if: (a) he is present in Singapore for a period or periods not exceeding in the aggregate 183 days during the calendar year concerned; and (b) the remuneration is paid by, or on behalf of an employer who is a resident of India; and (c) the remuneration is not borne by a permanent establishment which the employer has in Singapore. 4. Notwithstanding the preceding provisions of this Article, remunerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cal or statutory authority in discharge of functions of a governmental nature shall be taxable only in that Contracting State. If, however, the employment is exercised in the other Contracting State by a resident of that other State not being a citizen or national of the first-mentioned State, the remuneration shall be taxable only in that other State. 2. The provisions of paragraph 1 of this Article shall also apply to remuneration or pensions paid by the Reserve Bank of India and the Monetary Authority of Singapore. 3. Save as provided in paragraph 2, the provisions of this Article shall not apply to payments in respect of services in connection with any trade or business carried on by either of the Contracting States or political sub-division or a local authority or statutory authority thereof for purposes of profit. ARTICLE 19 Students, Trainees and Apprentices 1. An individual who is a resident of a Contracting State and who is temporarily present in the other Contracting State solely as a student at a recognised university, college, school or other educational institution in that other Contracting State or as a business or technical apprentice therein, for a period not e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12,500 Indian Rupees or its equivalent sum in Singapore currency per annum, for personal services rendered in that other Contracting State, provided such services are in connection with the acquisition of such experience. 4. An individual who is a resident of a Contracting State and who is temporarily present in the other Contracting State under arrangement with the Government of that other Contracting State solely for the purpose of training or study shall be exempt from tax in that other Contracting State in respect of remuneration received by him on account of such training or study. 5. For the purposes of this Article and Article 20- (a) (i) an individual shall be deemed to be a resident of India if he is resident in India in the " previous year " in which he visits Singapore or in the immediately preceding " previous year "; (ii) an individual shall be deemed to be a resident of Singapore if, immediately before visiting India, he is a resident of Singapore; (b) the term " recognised " in relation to a university, college, school or other educational institution in a Contracting State shall, in the case of doubt, be determined by the competent authority of that State. ART ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to or received in that other Contracting State and not by reference to the full amount thereof, then the exemption or reduction of tax to be allowed under this Agreement in the first-mentioned Contracting State shall apply to so much of the income as is remitted to or received in that other Contracting State. CHAPTER IV Method for Elimination of Double Taxation ARTICLE 24 Avoidance of Double Taxation 1. The laws in force in either of the Contracting States will continue to govern the taxation of income in the respective Contracting States except where provisions to the contrary are made in this Agreement. Where income is subject to tax in both Contracting States, relief from double taxation shall be given in accordance with the following paragraphs of this Article. 2. (a) The amount of Singapore tax payable, under the laws of Singapore, and in accordance with the provisions of this Agreement, whether directly or by deduction, by a resident of India, in respect of income from sources within Singapore which has been subjected to tax both in India and Singapore, shall be allowed as a credit against the Indian tax payable in respect of such income but in an amount not exceedi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reed by the competent authorities of the Contracting States to be of a substantially similar character, if it has not been modified thereafter or has been modified in minor respects so as not to affect its general character. CHAPTER V Special Provisions ARTICLE 25 Non-discrimination 1. Nationals or citizens of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which nationals or citizens of that other Contracting State in the same circumstances and under the same conditions are or may be subjected. This provision shall not be construed as obliging a Contracting State to grant to nationals of the other Contracting State not resident in the first-mentioned Contracting State those personal allowances, reliefs and reductions for tax purposes which are by law available only to citizens of the first-mentioned Contracting State or to such other persons as may be specified therein who are not resident in that Contracting State. 2. The term " nationals or citizens " means: (a) all individuals possessing the nationality or citi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding any time limits in the national laws of the Contracting States. 3. The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of this Agreement. They may also consult together for the elimination of double taxation in cases not provided for in this Agreement. 4. The competent authorities of the Contracting States may communicate with each other directly for the purposes of applying the provisions of this Agreement. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through a commission consisting of representatives of the competent authorities of the Contracting States. ARTICLE 27 Exchange of information The competent authorities of the Contracting States shall exchange such information as is necessary for carrying out the provisions of this Agreement or for the prevention or detection of evasion of the taxes which are the subject of this Agreement. Any information so exchanged shall be treated as secret but may be disclosed only to persons (including a court or administrative body) concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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