Double Taxation
Avoidance AgreementSection 90 of the
Income-tax Act, 1961 - Double Taxation Agreement - Agreement for Avoidance of
Double Taxation and Prevention of Fiscal Evasion with Foreign Countries - With
IrelandNotification
No. 45/2002 (F. No. 503/6/99-FTD), Dated 20-2-2002Whereas
the annexed Convention between the Government of the Republic of India and the
Government of Ireland for the Avoidance of Double Taxation and for the
Prevention of Fiscal Evasion with respect to taxes on income and capital gains
has entered into force on 26th December, 2001, thirty days after the receipt of
the later of the notifications by both the Contracting State to each other of
the completion of the procedure required by their respective laws, as required
by Article 28 of the said Convention.Now,
therefore, in exercise of the powers conferred by section 90 of the Income-tax
Act, 1961 (43 of 1961), the Central Government hereby directs that all the
provisions of the said Convention shall be given effect to in the Union of
India.ANNEXUREConvention
between the Government of the Republic of India and the Government of Ireland
For the Avoidance of Double Taxation and for the Prevention of Fiscal Evasion
with respect to taxes on Income and Capital GainsThe
Government of the Republic of India and the Government of Ireland, desiring to
conclude a Convention for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with respect to taxes on income and capital gains and with a
view to promoting economic co-operation between the two countries, have agreed
as follows:Article
1SCOPE
OF THE CONVENTION1.
This
Convention shall apply to persons who are residents of one or both of the
Contracting States.Article
2TAXES
COVERED1. This Convention shall
apply to taxes on income and capital gains imposed on behalf of a Contracting
State or of its political sub-divisions or local authorities irrespective of
the manner in which they are levied.2. There shall be
regarded as taxes on income and capital gains all taxes imposed on total
income, or on elements of income including taxes on gains from the alienation
of movable or immovable property.3. The existing taxes to
which the Convention shall apply are in particular:a. In India:The
income-tax including any surcharge thereon;( hereinafter referred to as
"Indian tax");a.b. In Ireland:i.
the
income tax;ii.
the
corporation tax; andiii.
the
capital gains tax (hereinafter referred to as "Irish tax").1.2.3.4. The Convention shall
apply also to any identical or substantially similar taxes which are imposed
after the date of signature of the Convention in addition to, or in place of,
the existing taxes referred to in paragraph 3. The competent authorities of the
Contracting States shall notify each other of significant changes which have
been made in their respective taxation laws.Article
3GENERAL
DEFINITIONS1. For the purposes of
this Convention, unless the context otherwise requires:a. the term
"India" means the territory of India and includes the territorial sea
and airspace above it, as well as any other maritime zone in which India has
sovereign rights, other rights and jurisdiction, according to the Indian law
and in accordance with international law, including the U.N. Convention on the
Law of the Sea;b. the term
"Ireland" includes any area outside the territorial waters of Ireland
which, in accordance with international law, has been or may hereafter be
designated under the laws of Ireland concerning the Continental Shelf, as an
area within which the rights of Ireland with respect to the sea and sub-soil
and their natural resources may be exercised;c. the term
"person" includes an individual a company, a trust, a partnership
which is treated as a taxable until under the Income-tax Act, 1961 (43 of 1961)
of India, a body of persons and any other entity which is treated as a taxable
unit under the taxation laws in force in the respective Contracting States;d. the term
"company" means any body corporate or any entity which is treated as
a body corporate for tax purposes;e. the terms
"enterprise" of a Contracting State" and "enterprise of the
other Contracting State" mean respectively an enterprise carried on by a
resident of a Contracting State and an enterprise carried on by a resident of
the other Contracting State;f. the term
"international traffic" means any transport by a ship or aircraft
operated by an enterprise of a Contracting State, except when the ship or
aircraft is operated solely between places in the other Contracting State;g. the term
"competent authority" means:i.
in
the case of India: the Central Government in the Ministry of Finance
(Department of Revenue) or their authorised representative;ii.
in
the case of Ireland: the Revenue Commissioners or their authorised representative;a.b.c.d.e.f.g.h. the term
"national" means:i.
in
relation to Ireland, any citizen of Ireland and any legal person, association
or other entity deriving its status as such from the laws in force in Ireland;ii.
in
relation to India (A) any individual possessing the nationality of India; (B)
any legal person, partnership or association deriving its status as such from
the laws in force in India;a.b.c.d.e.f.g.h.i. the term "fiscal
years" means:i.
in
the case of India, "previous year" as defined under section 3 of the
Income-tax Act, 1961;ii.
in
the case of Ireland, a year beginning with the sixth day of April in one year
and ending with the fifth day of April in the following year;a.b.c.d.e.f.g.h.i.j. the term
"tax" means Indian tax or Irish tax, as the context requires, but
shall not include any amount which is payable in respect of any default or
omission in relation to the taxes to which this Convention applies or which
represents a penalty or fine imposed relating to those taxes;k. the terms "a
Contracting State", "one of the Contracting States" and
"the other Contracting State" mean Ireland or the Republic of India,
as the context requires, and the term "Contracting States" means
Ireland and the Republic of India.2. As regards the application
of the Convention by a Contracting State any term not defined therein shall,
unless the context otherwise requires have the meaning which it has under the
law of that State concerning the taxes to which the Convention applies.Article
4RESIDENT1. For the purposes of
this Convention, the term "resident of a Contracting State" means any
person who, under the laws of that State, is liable to tax therein by reason of
his domicile, residence, place of management or any other criterion of a similar
nature.2. Where by reason of
the provisions of paragraph 1 an individual is a resident of both Contracting
States, then his status shall be determined as follows:a. he shall be deemed to
be a resident of the State in which he has a permanent home available to him;
if he has a permanent home available to him in both States, he shall be deemed
to be a resident of the State with which his personal and economic relations
are closer (centre of vital interests);b. if the State in which
he has his centre of vital interests cannot be determined, or if he has not a
permanent home available to him in either State, he shall be deemed to be a
resident of the State in which he has an habitual abode;c. if he has an habitual
abode in both States or in neither of them, he shall be deemed to be a resident
of the State of which he is a national;d. if he is a national
of both States or of neither of them the competent authorities of the
Contracting States shall settle the question by mutual agreement.1.2.3. Where by reason of
the provisions of paragraph 1 a person other than an individual is a resident
of both Contracting States, then it shall be deemed to be a resident of the
State in which its place of effective management is situated. If the State in
which its place of effective management is situated cannot be determined, then
the competent authorities of the Contracting States shall settle the question
by mutual agreement.Article
5PERMANENT
ESTABLISHMENT1. For the purposes of
this Convention, the term "permanent establishment" means a fixed place
of business through which the business of an enterprise is wholly or partly
carried on.2. The term
"permanent establishment" includes especially:a. a place of
management;b. a branch;c. an office;d. a factory;e. a workshop;f. a mine, an oil or gas
well, quarry or other place of extraction of natural resources;g. an installation or
structure used for the exploration or exploitation of natural resources;h. a sales outlet;i. a warehouse in
relation to a person providing storage facilities for others; andj. a farm, plantation or
other place where agricultural, forestry, plantation or related activities are
carried on.1.2.3. A building site or
construction or assembly project or supervisory activities in connection
therewith constitute a permanent establishment only if such site, project or
activity last more than six months.1114. An enterprise shall
be deemed to have a permanent establishment in a Contracting State and to carry
on business through that permanent establishment if it provides services or
facilities in connection with, or supplies plant and machinery on hire used for
or to be used in, the prospecting for, or extraction or exploitation of mineral
oils in that State.5. Notwithstanding the
previous provisions of this Article, he term "permanent
establishment" shall be deemed not to include:a. the use of facilities
solely for the purpose of storage display or delivery of goods or merchandise
belonging to the enterprise;b. the maintenance of a
stock of goods or merchandise belonging to the enterprise solely for the
purpose of storage, display or delivery;c. the maintenance of a
stock of goods or merchandise belonging to the enterprise solely for the
purpose of processing by another enterprise;d. the maintenance of a
fixed place of business solely for the purpose of purchasing goods or merchandise
or of collecting information for the enterprise;e. the maintenance of a
fixed place of business solely for the purpose of carrying on, for the
enterprise, any other activity of a preparatory or auxiliary character;f. the maintenance of a
fixed place of business solely for any combination of activities mentioned in
sub-paragraphs (a) to (e), provided that the overall activity of the fixed
place of business resulting from this combination is of a preparatory or
auxiliary character.1.2.3.4.5.6. Notwithstanding the
provisions of paragraphs 1 and 2, where a person - other than an agent of an
independent status to whom paragraph 8 applies - is acting in a Contracting
State on behalf of an enterprise of the other Contracting State, that
enterprise shall be deemed to have a permanent establishment in the
first-mentioned Contracting State in respect of any activities which that
person undertakes for the enterprise, if such a person:a. has and habitually
exercises in that State an authority to conclude contracts in the name of the
enterprise, unless the activities of such person are limited to those mentioned
in paragraph 5 which, if exercised through a fixed place of business would not
make this fixed place of business a permanent establishment under the
provisions of that paragraph; orb. has no such
authority, but habitually maintains in the first-mentioned State a stock of
goods or merchandise from which he regularly delivers goods or merchandise on
behalf of the enterprise; orc. habitually secures
orders in the first-mentioned State, wholly or almost wholly for the enterprise
itself or for the enterprise and other enterprises controlling, controlled by,
or subject to the same control as that enterprise.1.2.3.4.5.6.7. Notwithstanding the
preceding provisions of this Article, an insurance enterprise of a Contracting
State shall, except in regard to re-insurance, be deemed to have a permanent
establishment in the other Contracting State if it collects premiums in the
territory of that other State or insures risks situated therein through a
person other than an agent of an independent status to whom paragraph 8
applies.8. An enterprise shall
not be deemed to have a permanent establishment in a Contracting State merely
because it carries on business in that State through a broker, general commission
agent or any other agent of an independent status, provided that such persons
are acting in the ordinary course of their business. However, if the activities
of such an agent are carried out wholly or almost wholly for the enterprise and
the conditions made or imposed between them in their commercial and financial
relations differ from those which would have been made or imposed if this had
not been the case, that agent shall not be considered to be an agent of an
independent status for the purpose of this paragraph.9. 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 other Contracting State or which carries
on business in that other State (whether through a permanent establishment or
otherwise) shall not of itself constitute either company a permanent
establishment of the other.Article
6INCOME
FROM IMMOVABLE PROPERTY1. Income derived by a
resident of a Contracting State from immovable property (including income from agriculture
or forestry) situated in the other Contracting State may also be taxed in that
other State.2. The term
"immovable property" shall have the meaning which it has under the
laws of the Contracting State in which the property in question is situated.
The term shall in any case include property accessory to immovable property,
live-stock and equipment used in agriculture and forestry, rights to which the
provisions of general law respecting landed property apply, usufruct of
immovable property and rights to variable or fixed payments as consideration
for the working of, or the right to work, mineral deposits, sources and other
natural resources; ships, boats, aircraft and motor vehicles shall not be
regarded as immovable property.3. The provisions of
paragraph 1 shall apply to income derived from the direct use, letting, or use
in any other form of immovable property.4. The provisions of
paragraphs 1 and 3 shall also apply to the income from immovable property of an
enterprise and to income from immovable property used for the performance of
independent personal services.Article
7BUSINESS
PROFITS1. The profits of an
enterprise of a Contracting State shall be taxable only in that State unless
the enterprise carries on business in the other Contracting State through a
permanent establishment situated therein. If the enterprise carries on business
as aforesaid, the profits of the enterprise may also be taxed in the other
State but only so much of them as is attributable to that permanent
establishment.2. Subject to the
provisions of paragraph 3, where an enterprise of a Contracting State carries
on business in the other Contracting State through a permanent establishment
situated therein, there shall in each Contracting State be attributed to that
permanent establishment the profits which it might be expected to make if it
were a distinct and separate enterprise engaged in the same or similar
activities under the same or similar conditions and dealing wholly
independently with the enterprise of which it is a permanent establishment.3. In the determination
of the profits of a permanent establishment, there shall be allowed as
deductions expenses which are incurred for the purposes of the permanent
establishment, whether in the State in which the permanent establishment is
situated or elsewhere. Executive and general administrative expenses shall be
allowed as deductions in accordance with the taxation laws of that State.
Nothing in this paragraph shall, however authorise a deduction for expenses
which would not be deductible if the permanent establishment were a separate
enterprise.4. No 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 purposes of
the preceding paragraphs, the profits to be attributed to the permanent
establishment shall be determined by the same method year by year unless there
is good and sufficient reason to the contrary.6. Where profits include
items of income which are dealt with separately in other Articles of this
Convention, then the provisions of those Articles shall not be affected by the
provisions of this Article.Article
8SHIPPING
AND AIR TRANSPORT1. Profits derived by an
enterprise of a Contracting State from the operation or rental of ships or
aircraft in international traffic and the rental of containers and related equipment
which is incidental to the operation of ships or aircraft in international
traffic shall be taxable only in that Contracting State.2. The provisions of
paragraph 1 shall also apply to profits from the participation in a pool, a
joint business or an international operating agency.3. For the purposes of
this Article, interest on funds connected directly with the operation of ships
or aircraft in international traffic shall be regarded as profits derived from
the operation of such ships or aircraft; and the provisions of Article 11 shall
not apply in relation to such interest provided that such funds are incidental
to that operation.4. Notwithstanding the
preceding provisions of this Article, profits derived by an enterprise of a
Contracting State from the operation of ships between the ports of the other
Contracting State and the ports of third countries may be taxed in that other
Contracting State, but the tax imposed in that other State shall be reduced by
an amount equal to two thirds thereof.Article
9ASSOCIATED
ENTERPRISES1. Where-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, orb. 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 profits which would, but for
those conditions, have accrued to one of the enterprises but, by reason of
those condition, have not so accrued, may be included in the profits of that
enterprise and taxed accordingly.1.2. Where a Contracting
State includes in the profits of an enterprise of that State and taxes
accordingly profits on which an enterprise of the other Contracting State has
been charged to tax in that other State and the profits so included are profits
which would have accrued to the enterprise of the first-mentioned State if the
conditions made between the two enterprises had been those which would have
been made between independent enterprises, then that other State shall make an
appropriate adjustment to the amount of the tax charged therein on those
profits. In determining such adjustment, due regard shall be had to the other
provisions of this Convention and the competent authorities of the Contracting
States shall if necessary consult each other.Article
10DIVIDENDS1. Dividends paid by a
company which is a resident of a Contracting State to a resident of the other
Contacting State may be taxed in that other State.2. However, such
dividends may also be taxed in the Contracting State of which the company
paying the dividends is a resident and according to the laws of that State, but
if the recipient is the beneficial owner of the dividends the tax so charged
shall not exceed 10 per cent of the gross amount of the dividends. This
paragraph shall not affect the taxation of the company in respect of the
profits out of which the dividends are paid.3. The term
"dividends" as used in this Article includes income from shares or
other rights, not being debt-claims, participating in profit, as well as income
from other corporate rights which is subjected to the same taxation treatment
as income from shares by the laws of the State of which the company making the
distribution is a resident.4. The provisions of
paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends,
being a resident of a Contracting State, carries on business in the other
Contracting State of which the company paying the dividend is a resident,
through a permanent establishment situated therein, or performs in that other
State independent personal services from a fixed base situated therein, and the
holding in respect of which the dividends are paid is effectively connected
with such permanent establishment or fixed base. In such case the provisions of
Article 7 or Article 14, as the case may be, shall apply.5. Where a company which
is a resident of a Contracting State derives profits or income from the other
Contracting State, that other State may not impose any tax on the dividends
paid by the company, except insofar as such dividends are paid to a resident of
that other State or insofar as the holding in respect of which the dividends
are paid is effectively connected with a permanent establishment or a fixed
base situated in that other State, nor subject the company's undistributed
profits to a tax on the company is undistributed profits, even if the dividends
paid or the undistributed profits consist wholly or partly of profits or income
arising in such other State.Article
11INTEREST1. Interest arising in a
Contracting State and paid to a resident of the other Contracting State may be
taxed in that other State.2. However, such
interest may also be taxed in the Contracting State in which it arises and
according to the laws of that State, but if the recipient is the beneficial
owner of the interest the tax so charged shall not exceed 10 per cent of the
gross amount of the interest. The competent authorities of the Contracting
States shall by mutual agreement settle the mode of application of this
limitation.3. Notwithstanding the
provisions of paragraph 2, interest arising in a Contracting State shall be
exempt from tax in that Contracting State provided it is derived and
beneficially owned by, or derived in connection with a loan or credit extended,
guaranteed or insured by:a. the Government, a
political subdivision, a statutory body or a local authority of the other
Contracting State; orb.i.
in
the case of India, the Reserve Bank of India, the Industrial Finance Corporation
of India, the Industrial Development Bank of India, the Export-Import Bank of
India the National Housing Bank, the Small Industries Development Bank of India
and the Industrial Credit and Investment Corporation of India (ICICI); andii.
in
the case of Ireland, the Central Bank of Ireland; ora.b.c. any other similar
institution as may be agreed from time to time between the Competent
Authorities of the Contracting States.1.2.3.4. The term
"interest" as used in this Article means income from debt-claims of
every kind, whether or not secured by mortgage and whether or not carrying a
right to participate in the debtor's profits, and in particular, income from
government securities and income from bonds or debentures, including premiums
and prizes attaching to such securities, bonds or debentures, but does not
include any income which is treated as a dividend under Article 10. Penalty
charges for late payment shall not be regarded as interest for the purpose of
this Article.5. The provisions of
paragraphs 1 and 2 shall not apply if the beneficial owner of the interest,
being a resident of a Contracting State, carries on business in the other
Contacting State in which the interest arises, through a permanent
establishment situated therein, or performs in that other State independent
personal services from a fixed base situated therein, and the debt-claim in
respect of which the interest is paid is effectively connected with such
permanent establishment or fixed base. In such case the provisions of Article 7
or Article 14, as the case may be, shall apply.6. Interest shall be
deemed to arise in a Contracting State when the payer is that State itself, a
political subdivision, a local authority or a resident of the State. Where,
however, the person paying the interest, whether he is a resident of a
Contracting State or not has in a Contracting State a permanent establishment
or a fixed base in connection with which the indebtedness on which the interest
is paid was incurred, and such interest is borne by such permanent establishment
or fixed base, then such interest shall be deemed to arise in the Contracting
State in which the permanent establishment or fixed base is situated.7. Where, by reason of a
special relationship between the payer and the beneficial owner or between both
of them and some other person, the amount of the interest, 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 beneficial owner in the absence of such
relationships, the provisions of this Article shall apply only to the last
mentioned amount. In such case, the excess part of the payments shall remain
taxable according to the laws of each Contracting State, due regard being had
to the other provisions of this Convention.Article
12ROYALTIES
AND FEES FOR TECHNICAL SERVICES1. Royalties or fees for
technical services arising in a Contracting State and paid to a resident of the
other Contracting State may be taxed in that other State.2. However, such
royalties or fees for technical services may also be taxed in the Contracting
State in which they arise, and according to the laws of that State, but if the
recipient is the beneficial owner of the royalties or fees for technical
services, the tax so charged shall not exceed 10 per cent of the gross amount
of the royalties or fees for technical services.3. The terms
"royalties"a. The terms
"royalties" as used in this Article means payments of any kind
received as a consideration for the use of, or the right to use, any copyright
of literary, artistic or scientific work including cinematography films or
films or tapes for radio or television broadcasting, any patent, trade mark,
design or model, plan, secret formula or process or for the use of or the right
to use industrial, commercial or scientific equipment, other than an aircraft,
or for information concerning industrial, commercial or scientific experience;b. The term "fees
for technical services means payment of any kind in consideration for the
rendering of any managerial, technical or consultancy services including the
provision of services by technical or other personnel but does not include
payments for services mentioned in Articles 14 and 15 of this Convention.1.2.3.4. The provisions of
paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties or
fees for technical services, being a resident of a Contracting State, carries
on business in the other Contracting State in which the royalties or fees for
technical services arise through a permanent establishment situated therein, or
performs in that other State independent personal services from a fixed base
situated therein, and the right or property in respect of which the royalties
or fees for technical services are paid is effectively connected with such
permanent establishment or fixed base. In such case the provisions of Article 7
or Article 14, as the case may be, shall apply.5. Royalties or fees for
technical services shall be deemed to arise in a Contracting State when the
payer is that State itself, a political subdivision, a local authority or a
resident of that State. Where however, the person paying the royalties or fees
for technical services, whether he is a resident of a Contracting State or not,
has in a Contracting State a permanent establishment or a fixed base in
connection with which the liability to pay the royalties or fees for technical
services was incurred, and such royalties or fees for technical services are
borne by such permanent establishment or fixed base, then such royalties or
fees for technical services shall be deemed to arise in the State in which the
permanent establishment or fixed base is situated.6. Where, by reason of a
special relationship between the payer and the beneficial owner or between both
of them and some other person, the amount of the royalties or fees for
technical services, having regard to the use, right or information for which
they are paid, exceeds the amount which would have been agreed upon by the
payer and the beneficial owner in the absence of such relationship, the
provisions of this Article shall apply to the last-mentioned amount. In such
case the excess part of the payments shall remain taxable according to the laws
of each Contracting State, due regard being had to the other provisions of this
Convention.Article
13CAPITAL
GAINS1. Gains derived by a
resident of a Contracting State from the alienation of immovable property
referred to in Article 6 and situated in the other Contracting State may also
be taxed in that other State.2. Gains from the
alienation of movable property forming part of the business property of a
permanent establishment which an enterprise of a Contracting State has in the
other Contracting State or of movable property pertaining to a fixed base
available to a resident of a Contracting State in the other Contracting State
for the purpose of performing independent personal services, including such
gains from the alienation of such a permanent establishment (alone or with the
whole enterprise) or of such fixed base, may also be taxed in that other State.3. Gains derived by an
enterprise of a Contracting State from the alienation of ships or aircraft
operated in international traffic or movable property pertaining to the
operation of such ships or aircraft shall be taxable only in that State.4. Gains from the
alienation of shares of the capital stock of a company the property of which
consists directly or indirectly principally of immovable property situated in a
Contracting State may be taxed in that State.5. Gains from the
alienation of shares other than those mentioned in paragraph 4 in a company
which is a resident of a Contracting State may be taxed in that Contracting
State6. Gains from the
alienation of any property other than that referred to in paragraphs 1, 2, 3, 4
and 5 shall be taxable only in the Contracting State of which the alienator is
a resident.Article
14INDEPENDENT
PERSONAL SERVICES1. Income derived by a
resident of a Contracting State in respect of professional services or other
activities or an independent character shall be taxable only in that State
except in the following circumstances, when such income may also be taxed in
the other Contracting State:a. if he has a fixed
base regularly available to him in the other Contracting State for the purpose
of performing his activities; in that case, only so much of the income as is
attributable to that fixed base may be taxed in that other State; orb. if his stay in the
other State is for a period or periods aggregating 183 days or more in any
12-month period commencing or ending in the fiscal year concerned; in that case,
only so much of the income as is derived from his activities performed in that
other State may be taxed in that other State.1.2. The term
"professional services" includes especially independent scientific,
literacy, artistic, educational or teaching activities as well as the
independent activities of physicians, lawyers, engineers, architects, surgeons,
dentists and accountants.2.Article 15DEPENDENT
PERSONAL SERVICES1. Subject to the
provisions of Articles 16, 18, 19 and 21, salaries, wages and other similar
remuneration derived by a resident of a Contracting State in respect of an
employment shall be taxable only in that State unless the employment is
exercised in the other Contracting State. If the employment is so exercised,
such remuneration as it derived therefrom may be taxed in that other State.2. Notwithstanding the
provisions of paragraph 1, remuneration derived by a resident of a Contracting
State in respect of an employment exercised in the other Contracting State
shall be taxable only in the first-mentioned State if:a. the recipient is
present in the other State for a period or periods not exceeding in the
aggregate 183 days in any 12-month period commencing or ending in the fiscal
year concerned, andb. the remuneration is
paid by, or on behalf of, an employer who is not a resident of the other State,
andc. the remuneration is
not borne by a permanent establishment or a fixed base which the employer has
in the other State.3. Notwithstanding the
preceding provisions of this Article, remuneration derived in respect of an
employment exercised aboard a ship or aircraft operated in international
traffic by an enterprise of a Contracting State may be taxed in that State.Article
16DIRECTORS'
FEES - Directors'1.
Fees
and other similar payments derived by a resident of a Contracting State in his
capacity as a member of the board of directors of a company which is a resident
of the other Contracting State may also be taxed in that other State.Article
17ARTISTES
AND SPORTSPERSONS1. Notwithstanding the
provisions of Articles 14 and 15, income derived by a resident of a Contracting
State as an entertainer, such as a theatre, motion picture, radio or television
artiste, or a musician, or as a sportsperson, from his personal activities as
such exercised in the other Contracting State, may be taxed in that other
State.2. Where income in
respect of personal activities exercised by an entertainer or a sportsperson in
his capacity as such accrues not to the entertainer or sportsperson himself but
to some other person, that income may, notwithstanding the provisions of
Article 7, 14 and 15, be taxed in the Contracting State in which the activities
of the entertainer or sportsperson are exercised.3. The provisions of
paragraphs 1 and 2, shall not apply to income from activities performed in a
Contracting State by entertainers or sportspersons if the visit to that State
is substantially supported by public funds of one or both of the Contracting
States or of political subdivisions or local authorities thereof. In such a
case, the income is taxable only in the Contracting State of which the
entertainer or sportsperson is a resident.Article
18PENSIONS
AND ANNUITIES1. Subject to the
provisions of paragraph 2 of Article 19, pensions and other similar
remuneration paid to a resident of a Contracting State in consideration of past
employment and any annuity paid to such a resident in consideration of past
employment shall be taxable only in that State.2. The term
"annuity" means a stated sum payable periodically at stated times
during life or during a specified or ascertainable period of time under an
obligation to make the payments in return for adequate and full consideration
in money or money's worth.Article
19GOVERNMENT
SERVICE1.a. Remuneration, other
than a pension, paid by a Contracting State or a political subdivision or a
local authority thereof to an individual in respect of services rendered to
that State or subdivision or authority shall be taxable only in that State.b. However, such
remuneration shall be taxable only in the other Contracting State if the
services are rendered in that State and the individual is a resident of that
State who:i.
is
a national of that State; orii.
did
not become a resident of that State solely for the purpose of rendering the
services.1.2.a. Any pension paid by,
or out of funds created by, a Contracting State or a political subdivision or a
local authority thereof to an individual in respect of services rendered to
that State or subdivision or authority shall be taxable only in that State;b. However, such pension
shall be taxable only in the other Contracting State if the individual is a
resident of, and a national of, that State.1.2.3. The provisions of
Articles 15, 16, and 18 shall apply to remuneration and pensions in respect of
services rendered in connection with a business carried on by a Contracting
State or a political subdivision or a local authority thereof.Article
20STUDENTS
AND APPRENTICES1. A student or business
apprentice who is or was a resident of a Contracting State immediately before
visiting the other Contracting State and who is present in that other
Contracting State solely for the purpose of his education of training shall be
exempt from tax in that other State on:a. payments made to him
by persons residing outside that other State for the purposes of his
maintenance, education or training; andb. remuneration from
employment in that other State to the extent that it does not exceed the amount
which is exempt from tax under the laws of that other Contracting State for any
fiscal year; provided that such employment is directly related to his studies
or is undertaken for the purposes of his maintenance.1.2. The benefit of this
Article shall extend only for such period of time as may be reasonable or
customarily required to complete the education or training undertaken but in no
event shall any individual have the benefits of this Article for more than six
consecutive years from the date of his first arrival in the other Contracting
State.Article
21PROFESSORS,
TEACHERS AND RESEARCH SCHOLARS1. A professor, teacher
of research scholar who is or was a resident of one of the Contracting States
immediately before visiting the other Contracting State for the purpose of
teaching or engaging in research, or both, at a university, college or other
similar institution in that other Contracting State shall be exempt from tax in
that other State on any remuneration for such teaching or research for a period
not exceeding two years from the date of his first arrival in that other State
for such purpose.2. This Article shall
not apply to income from research, if such research is undertaken primarily for
the private benefit of a specific person or persons.3. For the purposes of
this Article and Article 20, an individual shall be deemed to be a resident of
a Contracting State if he is a resident in that Contracting State in the fiscal
year in which he visits the other Contracting State or in the immediately
preceding fiscal year.Article
22OTHER
INCOME1. Items of income of a
resident of a Contracting State, wherever arising, not dealt with in the
foregoing Articles of this Convention shall be taxable only in that State.Items
of income of a resident of a Contracting State, wherever arising, not dealt
with in the foregoing Articles of this Convention shall be taxable only in that
State.2. The provisions of
paragraph 1 shall not apply to income, other than income from immovable
property as defined in paragraph 2 of Article 6, if the recipient of such
income, being a resident of a Contracting State, carries on business in the
other Contracting State through a permanent establishment situated therein, or
performs in that other State independent personal services from a fixed base
situated therein and the right or property in respect of which the income is
paid is effectively connected with such permanent establishment or fixed base.
In such case the provisions of Article 7 or Article 14 as the case may be,
shall apply.3. Notwithstanding the
provisions of paragraph 1, if a resident of a Contracting State derives income
from sources within the other Contracting State in the form of winnings from
lotteries, crossword puzzles, races including horse races, card games and other
games of any sort or gambling or betting of any form or nature whatsoever such
income may be taxed in the other Contracting State.Article
23ELIMINATION
OF DOUBLE TAXATION1. 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 Convention.2. Subject to the
provisions of the laws of India regarding the allowance as a credit against
Indian tax of tax paid in a territory outside India (which shall not affect the
general principle hereof), the amount of Irish tax paid, under the laws of
Ireland and in accordance with the provisions of this Convention whether
directly or by deduction, by a resident of India, in respect of income from
sources within Ireland which has been subjected to tax both in India and
Ireland shall be allowed as a credit against the Indian tax payable in respect
of such income but in an amount not exceeding that proportion of Indian tax
which such income bears to the entire income chargeable to Indian tax.3. Subject to the
provisions of the laws of Ireland regarding the allowance as a credit against
Irish tax of tax payable in a territory outside Ireland (which shall not affect
the general principle hereof) -a. Indian tax payable
under the laws of India and in accordance with this Convention, whether
directly or by deduction, on profits, income and gains from sources within
India (excluding in the case of a dividend tax payable in respect of the
profits out of which the dividend is paid) shall be allowed as a credit against
any Irish tax computed by reference to the same profits, income and gains by
reference to which Indian tax is computed.b. In the case of a
dividend paid by a company which is a resident of India to a company which is a
resident of Ireland and which controls directly or indirectly 25 per cent or
more of the voting power in the company paying the dividend, the credit shall
take into account [in addition to any Indian tax creditable under the
provisions of sub-paragraph (a)] Indian tax payable by the company in respect
of the profits out of which such dividend is paid.1.2.3.4.a. For the purposes of
sub-paragraph (b) of paragraph 3, the term "Indian tax payable" shall
be deemed to include 75 per cent of the Indian tax which would have been paid
but for any exemption or reduction of tax granted under incentive provisions
contained in Indian law designed to promote economic development to the extent
that such exemption or reduction is granted for profits from industrial or
manufacturing activities, or from the development, maintenance and operation of
infrastructure facilities, or from agriculture, fishing or tourism (including
restaurants and hotels), provided that such incentive provisions remain in
substance unchanged since the date of signature of this Convention and that the
activities have been carried out within India.b. The provisions of
sub-paragraph (a) shall cease to apply after twelve years from the date of
entry into force of this Convention.c. Should India amend in
substance its incentive provisions in relation to the activities specified in
sub-paragraph (a) or introduce any new incentive provisions in relation to such
activities, India may request in writing that this paragraph should apply to
such amended or new provisions. Likewise, India may request in writing an
extension of the time-limit in sub-paragraph (b). Upon receipt of such request,
Ireland shall enter into negotiations with India for such purposes.1.2.3.4.5. For the purposes of
paragraphs 2 and 3, profits, income and gains owned by a resident of a
Contracting State which may be taxed in the other Contracting State in
accordance with the provisions of this Convention shall be deemed to arise from
sources in that other Contracting State.6. Income which in
accordance with the provisions of this Convention is not to be subjected to tax
in a Contracting State may be taken into account for calculating the rate of
tax to be imposed in that Contracting State on other income.Article
24NON-DISCRIMINATION1. Nationals 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 of
that other State in the same circumstances are or may be subjected. This
provision shall, notwithstanding the provisions of Article 1, also apply to
persons who are not residents of one or both of the Contracting States.2. The Taxation on a
permanent establishment which an enterprise of a Contracting State has in the other
Contracting State shall not be less favourably levied in that other State than
the taxation levied on enterprises of that other State carrying on the same
activities.3. Enterprises of a
Contracting State, the capital of which is wholly or partly owned or
controlled, directly or indirectly, by one or more residents of the other
Contracting State, shall not be subjected in the first-mentioned Stated to any
requirement connected therewith which is other or more burdensome than the
taxation and connected requirements to which other similar enterprises of the
first-mentioned State are or may be subjected.4. Except where the
provisions of paragraph 1 of Article 9, paragraph 7 of Article 11, or paragraph
6 of Article 12, apply, interest, royalties and other disbursements paid by an
enterprise of a Contracting State to a resident of the other Contracting State
shall, for the purpose of determining the taxable profits of such enterprise,
be deductible under the same conditions as if they had been paid to a resident of
the first-mentioned State.Article
25MUTUAL
AGREEMENT PROCEDURE1. Where a person
considers that the actions of one or both of the Contracting States result or
will result for him in taxation not in accordance with the provisions of this
Convention, he may, irrespective of the remedies provided by the domestic laws
of those States, present his case to the competent authority of the Contracting
State of which he is a resident or, if his case comes under paragraph 1 of
Article 24, to that of the Contracting State of which he is a national. The
case must be presented within three years from the first notification of the
action resulting in taxation not in accordance with the provisions of the
Convention.2. The competent
authority shall endeavour, if the objection appears to it to be justified and
if it is not itself able to arrive at a satisfactory solution, to resolve the
case by mutual agreement with the competent authority of the other Contracting
State, with a view to the avoidance of taxation which is not in accordance with
the Convention. Any agreement reached shall be implemented notwithstanding any
time limits in the domestic law 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
the Convention. They may also consult together for the elimination of double
taxation in cases not provided for in the Convention.4. The competent
authorities of the Contracting States may communicate with each other directly
for the purpose of reaching an agreement in the sense of the preceding
paragraphs. 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
26EXCHANGE
OF INFORMATION1. The competent
authorities of the Contracting States shall exchange such information including
documents, as is necessary for carrying out the provisions of this Convention
or of the domestic laws of the Contracting State concerning taxes covered by
the Convention insofar as the taxation thereunder is not contrary to the
Convention in particular for the prevention of fraud or evasion of such taxes.
The exchange of information is not restricted by Article 1.Any information so
exchanged by a Contracting State shall be treated as secret in the same manner
as information obtained under the domestic laws of the State and shall be
disclosed only to persons or authorities (including courts and administrative
bodies) concerned with the assessment or collection of, the enforcement or
prosecution in respect of, or the determination of appeals in relation to the
taxes covered by the Convention. Such persons or authorities shall use the
information only for such purposes. The may disclose the information in public
court proceedings or in judicial decisions.2. In no case shall the
provisions of paragraph 1 be construed so as to impose on a Contracting State
the obligation.a. to carry out
administrative measures at variance with the laws and administrative practice
of that or of the other Contracting State:b. to supply information
or documents which are not obtainable under the laws or in the normal course of
the administration of that or of the other Contracting State.c. to supply information
which would disclose any trade, business, industrial, commercial or
professional secret or trade process, or information, the disclosure of which
would be contrary to public policy.Article
27DIPLOMATIC
AGENTS AND CONSULAR OFFICIALS1.
Nothing
in this convention shall affect the fiscal privileges of diplomatic agents or
consular officials under the general rules of international law or under the
provisions of special agreements.