Tax Residence Certificate (TRC) for claiming relief under DTAA (N/N 39/2012 dated 17-09-2012)
Section 90 of the Income Tax Act empowers the Central Government to enter into an agreement with the Government of any foreign country or specified territory outside India for the purpose of –
(i) granting relief in respect of avoidance of double taxation,
(ii) exchange of information and
(iii) recovery of taxes.
Further section 90A of the Act empowers the Central Government to adopt any agreement between specified associations for relief of double taxation.
In exercise of this power, the Central Government has entered into various Double Taxation Avoidance Agreements (DTAA’s) with different countries and have adopted agreements between specified associations for relief of double taxation . The scheme of interplay of treaty and domestic legislation ensures that a taxpayer, who is resident of one of the contracting country to the treaty, is entitled to claim applicability of beneficial provisions either of treaty or of the domestic law.
It is noticed that in many instances the taxpayers who are not tax resident of a contracting country do claim benefit under the DTAA entered into by the Government with that country. Thereby, even third party residents claim unintended treaty benefits.
Therefore, it is FA 2012 amend Section 90 and Section 90A of the Act to make submission of Tax Residency Certificate containing prescribed particulars, as a necessary but not sufficient condition for availing benefits of the agreements referred to in these Sections.
These amendments will take effect from 1st April, 2013 and will, accordingly, apply in relation to the assessment year 2013-14 and subsequent years.
N/N 39/2012 dated 17-09-2012 notified format of application and procedure for obtaining tax residency certificate.
Please find below N/N 39/2012 dated 17-09-2012 for your reference.
*************************************************************************************************************************************************
INCOME-TAX (TWELFTH AMENDMENT) RULES, 2012 - INSERTION OF RULE 21AB AND FORM NOS. 10FA & 10FB
NOTIFICATION NO. 39/2012 [F.NO.142/13/2012-SO(TPL)]/SO 2188(E), DATED 17-9-2012
In exercise of the powers conferred by section 90 and 90A read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-
1. (1). These rules may be called the Income-tax (12th Amendment) Rules, 2012.
(2). They shall come into force on the 1st day of April, 2013.
2. In the Income-tax Rules, 1962 (hereafter referred to as the principal rules), -
(a) after rule 21AA, the following rule shall be inserted, namely.-
"Certificate for claiming relief under an agreement referred to in section 90 and 90A.
21AB (1) The certificate referred to in sub-section (4) of section 90 and sub-section (4) of section 90A to be obtained by an assessee, not being a resident in India, from the Government of the country or the specified territory shall contain the following particulars, namely:-
(i) Name of the assessee;
(ii) Status (individual, company, firm etc.) of the assessee;
(iii) Nationality (in case of individual);
(iv) Country or specified territory of incorporation or registration (in case of others);
(v) Assessee's tax identification number in the country or specified territory of residence or in case no such number, then, a unique number on the basis of which the person is identified by the Government of the country or the specified territory;
(vi) Residential status for the purposes of tax;
(vii) Period for which the certificate is applicable; and
(viii) Address of the applicant for the period for which the certificate is applicable;
(2) The certificate referred to in sub-rule (1) shall be duly verified by the Government of the country or the specified territory of which the assessee, referred to in sub-rule (1), claims to be a resident for the purposes of tax.
(3) An assessee, being a resident in India, shall, for obtaining a certificate of residence for the purposes of an agreement referred to in section 90 and section 90A, make an application in Form No. 10FA to the Assessing Officer.
(4) The Assessing Officer on receipt of an application referred to in sub-rule (3) and being satisfied in this behalf, shall issue a certificate of residence in respect of the assessee in Form No. 10FB.";
(b) in Appendix-II, after the Form No. 10F, the following Forms shall be inserted, namely: -
"FORM No. 10FA
[See rule 21AB (3)]
Application for Certificate of residence for the purposes of an agreement under section 90 and 90A of the Income Tax Act, 1961
To
The Assessing Officer,
_________________,
_________________,
_________________,
Sir,
I request that a certificate of residence in Form No. 10FB be granted in my case/in the case of ________________________ [for person other than individual]
| | 2. The relevant details in this regard are as under: - |
| | (i) | Full Name and address of the applicant | | |
| | (ii) | Status (State whether individual, Hindu undivided family, firm, body of individuals, company etc.) | | |
| | (iii) | Nationality (in case of individual) | | |
| | (iv) | Country of incorporation/registration (in case of others). | | |
| | (v) | Address of the applicant during the period for which TRC is desired. | | |
| | (vi) | Email ID | | |
| | (vii) | PAN/ TAN No. (if applicable) | | |
| | (viii) | Basis on which the status of being resident in India is claimed. | | |
| | (ix) | Period for which the residence certificate is applicable | | |
| | (x) | Purpose of obtaining Tax Residency Certificate (must be specified) | | |
| | (xi) | Any other detail | | |
| | 3. The following document in support are enclosed: - |
| | (1) | | | |
| | (2) | | | |
| | (3) | | | |
VERIFICATION
I, ____________ [full name in block letters] __________ son/daughter of ________________________, in the capacity of ________________ [designation for person other than individual], verify that to the best of my knowledge and belief, the information given in this form is correct and complete and that the other particulars shown therein are truly stated.
Verified today the ____________________ day of ____________
| Place | Signature of the Applicant ____________________
Name____________________________________ |
| | | |
FORM No. 10FB
[See rule 21AB (4)]
Certificate of residence for the purposes of section 90 and 90A
| | 1. | Name of the Person | | |
| | 2. | Status | | |
| | 3. | Permanent Account Number | | |
| | 4. | Address of the person during the period of Tax Residency Certificate. | | |
Certificate
If is hereby certified that the above mentioned person is a resident of India for the purposes of Income-tax Act, 1961.
This certificate is valid for the period __________________
Issued on __________ the day of ________, ________,
| | | Name of the Assessing Officer |
| | | Designation____________ |
| Contact us for any query/clarification at bkumarca80@gmail.com, Cell +91 9560084833 | | Seal ".________________" |
■■
