The Double Taxation Avoidance Treaty (DTT) between Cyprus and India has been signed on 18th of November 2016. According to official statements, with the signing of the DTT Agreement, the Republic of Cyprus shall be removed from the Indian tax authorities list of “Notified Jurisdictional Area”, with retrospective effect from the 1st of November 2013.
The DTT Agreement text agreed between the two countries settles all commitments between the two countries that have been pending for a number of years, providing stability and certainty to investors, whilst contributing to further development of trade and economic activities between Cyprus and India, as well as other neighbouring countries.
The DTT Agreement provides for the taxation of capital gains from the disposal of shares at source. It is noted that a certain grace period is also applicable for investments that have been undertaken or will be undertaken by the 1st of April 2017, so that any taxation of future disposal of said investments will remain in the contracting State of the residence of the seller.
The continuous updating, preservation and extension of the existing DTT Network, which are of utmost economic and political importance to the government of Cyprus, aims to draw additional foreign investments and further promote Cyprus as an established international business centre.