Tax Rates as per DTAAs and Income Tax Act

Non-residents can compute their tax liability as per the tax rates prescribed under the Income-tax Act
or
the rates prescribed under the DTAAs (Double Taxation Avoidance Agreements), whichever is more beneficial.

This page contains tax rates prescribed under the Income-tax Act and under the DTAAs for following incomes:

Dividend Income other than dividends covered u/s 115-O

Tax Rates applicable on dividend Income (other than dividend covered under Section 115-O) as per Income Tax Act

  1. 10% on income from Global Depository Receipts under Section 115AC(1)(b) of Income-tax Act, 1961 (other than dividends referred to in section 115-O).
  2. 20% under Section 115A on dividend (other than dividends referred to in section 115-O) received by a foreign company or a non-resident non-corporate assessee
  3. 20% under Section 115AD on dividend (other than dividends referred to in section 115-O) received by a Foreign institutional investor.

Tax Rates applicable on dividend Income (other than dividends covered u/s 115-O) as per DTTAs

Select Country Tax Rates as per DTAA

Interest

Tax Rates applicable on Interest Income as per Income Tax Act

  1. 20% under Section 115A on interest received by a foreign company or a non-resident non-corporate assessee from Government or an Indian concern on moneys borrowed or debt incurred by Government or the Indian concern in foreign currency.
  2. 10% under Section 115AC on income from bonds of an Indian company issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf, or on bonds of a public sector company sold by the Government, and purchased by non-resident in foreign currency
  3. 5% in following cases:
    1. Interest received from an infrastructure debt fund as referred to in section 10(47)
    2. Interest received from an Indian company specified in section 194LC.
    3. Interest of the nature and extent referred to in section 194LD (applicable from the assessment year 2014-15).
    4. Distributed income being interest referred to in section 194LBA(2) (section 194LBA is inserted by the Finance (No. 2) Act, 2014 w.e.f 01-10-2014)

Tax Rates applicable on Interest Income as DTAAs

Select Country Tax Rates as per DTAA

Royalty

Tax Rates applicable on Royalty Income as per Income Tax Act

From Assessment Year 2014-15, Royalty received by a foreign company or a non-resident non-corporate assessee from government or an Indian concern are taxabled at the rate of 25% if agreement is made at any time after 31 March 1976.

Tax Rates applicable on Royalty Income as DTAAs

Select Country Tax Rates as per DTAA
 

Fee for Technical Services

Tax Rates applicable on Income from Fee for Technical Services as per Income Tax Act

From Assessment Year 2014-15, fees for technical service received by a foreign company or a non-resident non-corporate assessee from government or an Indian concern are taxable at the rate of 25% if agreement is made at any time after 31 March 1976.

Tax Rates applicable on Income from Fee ffor Technical Services as DTAAs

Select Country Tax Rates as per DTAA
 

Disclaimer : The above information has been compiled from the official website of Income Tax Department. Due diligence is exercised in compiling while compiling the information. However, inadvertent errors / omissions are not ruled out. This site makes no claim that the forms made available for download are correct and / or up-to-date. For further clarifications / details and up-to-date information the visitors may visit the official website of Income Tax Department / view the relevant Double Taxation Avoidance Agreement