Case Note: Non-Compete Fees Paid on the Sale of Shares Not Taxable

Journal
Author
Dugar, A.; Bhandari, L.
Country
India
Published Date
Issue
Asia-Pacific Tax Bulletin 2018 (Volume 24), No. 5
FormatPDF
EUR
45
| USD
50 (VAT excl.)

This case note sets out the ruling by the Authority for Advance Rulings in HM Publishers Holdings Limited that the receipt by a shareholder of non-compete fees paid on the sale of shares of a company to another company constitutes business income. However, in the absence of a permanent establishment in India, the foreign shareholder was not chargeable to tax in India under the India-United Kingdom Income Tax Treaty (1993).