What is the necessity of Double Taxation Avoidance Agreement (DTAA) and how do such agreements work?
A DTAA is a bilateral arrangement between two countries which forms part of the fiscal code of the respective country. This agreement can be accessed by the residents of either country and does not restrict the basic right of a sovereign country to tax the income in question. As per the Indian Income-tax Act, 1961 (the Act) or DTAA whichever is favourable can be applied by an assessee with reference to a transaction. Top • What are the features of the DTAA signed between India and other countries? Most of the DTAAs are drafted on the same lines. There are around 25 articles covering general matters and matters relating to definitions. The substantive portion of the articles specify the rates of tax applicable to various streams of income, relief from double taxation in respect of various categories of income and also covers procedures to resolve disputes. Top • In case of dispute in the interpretation of the DTAA terms, how can the same be redressed? Any dispute in the interpretation o
