Announcement of the Cyprus Ministry of Finance on the double taxation treaty with the Republic of India
Contributed by Patrikios Pavlou & Associates LLC
07 July, 2016
The Cyprus Ministry of Finance has officially announced that the negotiations on the double tax treaty ('DTT') with the Republic of India have been successfully completed on 29 June 2016, in New Delhi. According to the Ministry's announcement, once the relevant DTT enters into force, the Indian authorities will rescind the classification of Cyprus as a Notified Jurisdictional Area, with retrospective effect as from 1 November 2013.
This DTT provides for source based taxation for gains arising from the alienation of shares. Nevertheless investments undertaken prior to 1 April 2017 are "grandfathered" with the view that taxation of disposal of such shares at any future date remains with the contracting state of the seller's residence.
It is expected that the agreement reached, will further enhance the trade, business and economic relations between Cyprus and India.
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