Latest news with #DoubleTaxationAvoidanceAgreement
Time of India
2 days ago
- Business
- Time of India
India-Oman DTAA amended: What does the new tax treaty mean for salaried professionals, freelancers, and business owners? What experts say
India and Oman have revised their Double Taxation Avoidance Agreement (DTAA), first signed in 1997, to align with evolving global tax standards and cross-border economic realities. The updated pact, which comes into effect from May 28, 2025, aims to provide relief to individuals and businesses earning income in both countries by eliminating the risk of being taxed twice. The revised DTAA will benefit Indian residents with investments or professional engagements in Oman, and vice versa. This includes salaried professionals, freelancers, and business owners earning income across both jurisdictions, according to an ET report. 'The revision aims to promote cross-border investments and technology transfer by lowering tax rates on royalties and fees for technical services from 15% to 10%,' Pankaj Agrawal, Associate Director at Grant Thornton, told the financial daily 'Further, updates have been made in definitions, mutual agreement procedures (MAP), and enhanced information exchange between the jurisdictions,' he added. Sudhir Kaushik, Cofounder and CEO of said the revised India-Oman tax treaty is a 'positive move for fair and clear taxation' that also strengthens information sharing, helping honest taxpayers and reducing tax evasion. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Giao dịch CFD với công nghệ và tốc độ tốt hơn IC Markets Tìm hiểu thêm Undo He was quoted as saying that the agreement also includes a non-discrimination clause that ensures tax parity between Indian and Omani entities operating in each other's countries. The revised treaty includes a stronger MAP framework to resolve tax disputes more efficiently and introduces anti-abuse provisions to prevent treaty shopping. It also enhances data exchange protocols, including access to financial and banking information, making cross-border tax evasion more difficult. Oman will also become the first Gulf Cooperation Council (GCC) nation to introduce personal income tax. As per the proposed plan, from January 2028, Oman will levy a 5% income tax on individuals earning above OMR 42,000. Until now, GCC countries such as the UAE, Saudi Arabia, Qatar, and Kuwait have not imposed personal income tax, relying largely on oil revenues. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
3 days ago
- Business
- Economic Times
India, Oman revise DTAA: What's the income tax impact on professionals earning in both countries?
iStock This move will ensure that taxpayers who are financially active in both India and Oman are not unfairly taxed twice on the same income If you earn income in both India and Oman—say through employment in Oman and investments in India—and pay taxes in India, there's good news, whether you're a salaried professional, business owner, or freelancer. Both nations have revised their Double Taxation Avoidance Agreement (DTAA), originally signed in 1997, to reflect today's global tax norms and economic conditions. This update will be effective from 28 May 2025, ensuring that taxpayers aren't unfairly taxed twice on the same income in India and Oman. This brings relief to individuals and businesses working across both countries by creating clear rules about where and how income will be taxed. Oman will be the first country in the Gulf Cooperation Council (GCC) to start levying personal income tax at the rate of 5% for high income earners. The tax proposed with effect from January 2028 would be applicable for income above OMR 42,000. Until now, GCC nations, including Bahrain, Kuwait, Qatar, Saudi Arabia, and the UAE, have relied mainly on oil exports and have not imposed personal income tax. After the introduction of GCC VAT and corporate income tax, introduction of personal income tax seems to be the next step towards expanding sources of revenue for the government. India has DTAA pacts with multiple countries Comprehensive DTAAs cover all income types, while others apply to limited or specific cases. 'The revision aims to promote crossborder investments and technology transfer by lowering tax rates on royalties and fees for technical services from 15% to 10%. Further, updates have been made in the form of changes in certain definitions, mutual agreement procedures (MAP) and enhancing the framework for information exchange between the two jurisdictions. The agreement has been amended to adapt to the changing economic conditions and global tax reforms, aligning it with the current economic realities,' says Pankaj Agrawal, Associate Director, Global People Solutions, Grand Thornton.'The revised India-Oman tax treaty is a positive move for fair and clear taxation. It also prevents misuse of the treaty and makes information sharing stronger, helping honest businesses and reducing tax evasion,' says Sudhir Kaushik, Cofounder & CEO, important change is the introduction of a non-discrimination clause, which guarantees equal tax treatment for residents of both countries. So, for example, an Indian company operating in Oman will not face a higher tax burden than a comparable Omani firm. The treaty strengthens information exchange mechanisms between the two countries. Tax authorities will now share data more freely, even from banks and financial intermediaries, making it harder to hide income across borders. The revised agreement includes a better MAP to resolve tax disputes more efficiently. It also introduces new rules to prevent abuse of treaty benefits by third-country entities through treaty both nations will assist each other in tax collection. If someone owes tax in India and relocates to Oman, the local authorities can now help recover that amount and vice versa.
Time of India
3 days ago
- Business
- Time of India
India, Oman revise DTAA: What's the income tax impact on professionals earning in both countries?
India has DTAA pacts with multiple countries Academy Empower your mind, elevate your skills If you earn income in both India and Oman—say through employment in Oman and investments in India—and pay taxes in India, there's good news, whether you're a salaried professional, business owner, or nations have revised their Double Taxation Avoidance Agreement (DTAA), originally signed in 1997, to reflect today's global tax norms and economic conditions. This update will be effective from 28 May 2025, ensuring that taxpayers aren't unfairly taxed twice on the same income in India and Oman. This brings relief to individuals and businesses working across both countries by creating clear rules about where and how income will be will be the first country in the Gulf Cooperation Council (GCC) to start levying personal income tax at the rate of 5% for high income tax proposed with effect from January 2028 would be applicable for income above OMR 42,000. Until now, GCC nations, including Bahrain, Kuwait, Qatar, Saudi Arabia, and the UAE, have relied mainly on oil exports and have not imposed personal income tax. After the introduction of GCC VAT and corporate income tax, introduction of personal income tax seems to be the next step towards expanding sources of revenue for the DTAAs cover all income types, while others apply to limited or specific cases.'The revision aims to promote crossborder investments and technology transfer by lowering tax rates on royalties and fees for technical services from 15% to 10%. Further, updates have been made in the form of changes in certain definitions, mutual agreement procedures (MAP) and enhancing the framework for information exchange between the two jurisdictions. The agreement has been amended to adapt to the changing economic conditions and global tax reforms, aligning it with the current economic realities,' says Pankaj Agrawal, Associate Director, Global People Solutions, Grand Thornton.'The revised India-Oman tax treaty is a positive move for fair and clear taxation. It also prevents misuse of the treaty and makes information sharing stronger, helping honest businesses and reducing tax evasion,' says Sudhir Kaushik, Cofounder & CEO, important change is the introduction of a non-discrimination clause, which guarantees equal tax treatment for residents of both countries. So, for example, an Indian company operating in Oman will not face a higher tax burden than a comparable Omani firm. The treaty strengthens information exchange mechanisms between the two countries. Tax authorities will now share data more freely, even from banks and financial intermediaries, making it harder to hide income across borders. The revised agreement includes a better MAP to resolve tax disputes more efficiently. It also introduces new rules to prevent abuse of treaty benefits by third-country entities through treaty both nations will assist each other in tax collection. If someone owes tax in India and relocates to Oman, the local authorities can now help recover that amount and vice versa.
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Business Standard
17-06-2025
- Business
- Business Standard
Paid taxes abroad as an Indian resident? Here's how to claim tax credit
If you're an Indian resident earning income overseas and have already paid tax on that income abroad, you may be eligible for a foreign tax credit (FTC) while filing your tax returns in India. However, experts caution that to successfully claim it, careful documentation and timely filing are critical. Who can claim foreign tax credit in India? Any Indian resident, individual or entity, who has paid taxes in a foreign country on income that is also taxable in India, can claim the foreign tax credit. 'FTC can be claimed whether or not there is a Double Taxation Avoidance Agreement (DTAA) between India and the foreign country,' said SR Patnaik, partner (head-taxation), Cyril Amarchand Mangaldas. 'The credit is allowed in the year in which the corresponding income is taxed in India,' he added. According to Abhishek Nangia, senior associate at SKV Law Offices, 'FTC helps avoid double taxation and can be claimed under Section 90 or 91 of the Income Tax Act. The credit is limited to the lower of the foreign tax paid or the Indian tax payable on that income.' Documents needed to claim foreign tax credit The experts suggest that filing Form 67 before submitting your income tax return is a mandatory requirement. This should be accompanied by: A statement of foreign income taxed in India Proof of foreign tax payment (such as bank challans, tax certificates) Nature and amount of income Tax Residency Certificate (TRC) from the foreign country (recommended, especially when claiming DTAA relief) In some cases, Form 10F and a No Permanent Establishment declaration 'A self-declaration along with proof of tax deduction or payment abroad is also necessary,' noted Suresh Surana, chartered accountant. Common mistakes to avoid while claiming foreign tax credit All three experts agree that filing Form 67 late or with incomplete details is a major reason for rejections. Errors in reporting foreign income, mismatches with Form 26AS, or claiming FTC on income that is exempt in India also trigger scrutiny. 'Disputed foreign taxes cannot be claimed unless resolved, and penalties or interest paid overseas are not eligible for credit,' Nangia added. Surana warns that 'claiming more credit than allowed under Indian tax rates or without proper documents may attract notices or disallowance.' How credit is calculated The credit allowed is the lower of the foreign tax paid or Indian tax payable on that same income. 'If the foreign tax is higher, you only get credit up to Indian rates; the rest is your loss,' said Nangia. Patnaik clarified that Rule 128 governs this, and DTAA provisions apply if beneficial to the taxpayer, except where GAAR is invoked. In DTAA cases, Surana said, credit may be given under the exemption or credit method, and if no DTAA exists, unilateral relief is allowed under Section 91 of the Income Tax Act. Bottom line: Claiming foreign tax credit is not difficult, but missing even a single step can cost you. To stay on the right side of the tax department, stick to timelines, maintain thorough documentation, and consult a tax professional if needed.
Time of India
11-06-2025
- Business
- Time of India
'Cutting red tape in India key to Swiss investments': Helene Budliger Artieda
Bern: A good regulatory framework and cut in red tape in India is important to attract Swiss investments, Switzerland's state secretary for economic affairs Helene Budliger Artieda has said. She also ruled out any impact of the withdrawal of most favoured nation treatment for India by Switzerland under the bilateral tax treaty on investment flows under the trade agreement with European Free Trade Association (EFTA). "We need to have the best framework conditions (for the $100 billion commitment on investment) and this was part of the business roundtable meeting in the presence of minister Goyal. It will be important that red tape be cut as much as possible," she said. Even in Switzerland, companies complain about too much red tape, she added. "It will be very important that India creates a good framework for Swiss investments to come in," she told reporters after her meeting with commerce and industry minister Piyush Goyal on Tuesday. Live Events India and the EFTA, which includes Switzerland, Norway, Iceland and Liechtenstein, signed a free trade agreement on March 10, 2024, which is expected to come into force in a few months. It provides for an investment commitment of $100 billion in 15 years from the grouping in lieu of customs duty concessions. Goyal is on a four-day visit to Switzerland and Sweden. On the issue of the Swiss government suspending the MFN clause in the Double Taxation Avoidance Agreement (DTAA) between India and Switzerland, Artieda said there has been some misunderstanding on this. "I think it's important to know that both India and Switzerland share a double taxation treaty and that treaty is valid and that means there will not be any issue," she said. In a statement in December 2024, the Swiss government announced the suspension of the MFN clause in the DTAA between India and Switzerland, potentially impacting Swiss investments in India and leading to higher taxes on Indian companies operating in the European nation. She noted that the trade agreement will help increase exports of Swiss watches and chocolates to India as companies will have the advantage of preferred access. New Delhi is also in talks with the European Union for a comprehensive free trade agreement. (The correspondent is in Switzerland at the invitation of the ministry of commerce and industry.)
