Analysis of Deemed Accrual of Income in India: A Comprehensive Review of Clause 9 of Income Tax Bill, 2025

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..... ovision that establishes the framework for determining when income is deemed to accrue or arise in India. This provision is fundamental to India's international taxation regime and defines the territorial nexus required for taxing various forms of income earned by non-residents. 2. Objective and Purpose The primary objectives of this provision are: * To establish clear criteria for determi .....

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..... n citizens for overseas services b) Dividend Income (Sub-section 4): * All dividends paid by Indian companies deemed to accrue in India c) Interest Income (Sub-section 5): * Interest paid by government * Interest paid by residents (with specific exceptions) * Interest paid by non-residents for Indian business d) Royalty Income (Sub-section 6): * Comprehensive definition covering vario .....

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..... for small shareholders 4. Practical Implications 4.1 For Businesses * Need to evaluate digital presence in India * Review of existing business structures * Compliance requirements for cross-border transactions * Impact on international operations 4.2 For Tax Administration * Enhanced tools for taxing digital businesses * Clearer framework for determining taxable nexus * Improved .....

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