This article is an update to our previous article, titled: “Reduction of Dividend WHT (to 5%) under India-Netherlands DTAA as India abolishes DDT (from 1 April 2020)”. With the abolition of the Indian Dividend Distribution Tax (“DDT”) and a return to the “shareholder based taxation system” for dividends paid by Indian companies with effect of 1 April 2020, the withholding tax (“WHT”) rates prescribed in respect of dividends in the Indian Double Taxation Avoidance Agreements (“DTAAs”) have become a popular topic for discussion.
Dividend WHT rate under the India-Netherlands DTAA
The text of the India-Netherlands DTAA prescribes that either country may levy 15% WHT on the gross amount of dividends flowing to the other country. However, in Protocol IV no.2 of the DTAA, it has been agreed that, “if, after the signing of this convention, under any Convention or Agreement between India and a third State which is a member of the OECD
Neha works as an associate at NovioTax. She assists MNE
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