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India-Fiji Double Taxation Avoidance Agreement (DTAA)

The Double Taxation Avoidance Agreement (DTAA) between India and Fiji, which entered into force on May 15, 2014, marks a significant milestone in the bilateral relations of the two countries. This tax treaty, signed on January 30, 2014, is the first of its kind between India and Fiji, with the primary objective of providing tax stability to the residents of both nations and fostering mutual economic cooperation.

Taxes Covered

The India-Fiji DTAA covers the following types of taxes:

  • In India: Income tax, including any tax surcharges.
  • In Fiji: Income tax (including normal income tax, non-resident dividend withholding tax, royalty withholding tax, interest withholding tax, and dividend tax), and land sales tax.

Key Takeaways

Here are the major highlights of the India-Fiji DTAA:

  1. Services Permanent Establishment: The treaty introduces the concept of a permanent establishment, which is deemed to be constituted when an enterprise provides services through employees or engaged personnel for the same or connected project for a period exceeding 182 days in any 12-month period.
  2. Business Profits: Business profits will be taxable in the source state if the activities of an enterprise constitute a permanent establishment in the source state.
  3. Withholding Tax Rates: The applicable tax rates under the DTAA are as follows:
    • Dividends: 5%
    • Interest: 10%
    • Royalties and Fees for Technical Services: 10%

Dividends, interest, royalty income, and fees for technical or professional services will be subject to taxation in both the country of residence and the country of source.

  1. Capital Gains Tax: Capital gains arising from the sale of shares will be taxable in the country of source.
  2. Profits from Operation of Aircraft: Profits derived by an enterprise from the operation of aircraft in international traffic will be taxable in the country where the place of effective management of the enterprise is situated.
  3. Double Taxation Relief: Both countries will apply the credit method for the elimination of double taxation. This means that income is taxed in only one country, and if it is taxed in both countries, the tax paid in one country is allowed as a deduction from the tax payable in the other country, as per the agreement.
  4. Limitation on Benefits: The treaty includes a limitation on benefits clause, ensuring that the treaty’s benefits are not available to residents of either state if their affairs are structured primarily to obtain treaty benefits.
  5. Anti-Abuse Provision: The DTAA incorporates anti-abuse provisions to safeguard against misuse. These provisions ensure that the treaty’s benefits are accessible only to bona fide residents of both countries, preventing any abuse of the tax treaty.


The India-Fiji DTAA serves as a crucial tool for curbing fiscal evasion related to income taxes. The agreement promotes an effective exchange of information and facilitates tax collection between the tax authorities of both countries, including the exchange of banking information.

Moreover, the DTAA underscores that business profits shall be taxable in the source state if an enterprise’s activities constitute a permanent establishment in that state. Anti-abuse provisions have also been included to ensure that the treaty’s advantages are exclusively available to the genuine residents of both countries.

For detailed legal advice or further information regarding the India-Fiji Double Taxation Avoidance Agreement or any other legal matters, please do not hesitate to reach out to Chandrawat & Partners. Our legal team specializes in international tax agreements and stands ready to provide top-tier legal assistance to meet your needs.

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To know more about DTAA relations between India and Fiji, please download our Guide.