New Delhi, July 1 (IANS) India and Cyprus have agreed to revise their bilateral Double Taxation Avoidance Agreement (DTAA) whereby capital gains tax will apply on sale of shares on investments made after April 1, 2017, an official statement said on Friday
"It was agreed to provide for source-based taxation of capital gains on transfer of shares," said a finance ministry statement here.
"However, a grandfathering clause would be provided for investments made prior to 1.4.2017, in respect of which capital gains would be taxed in the country of which the taxpayer is a resident," it said.
This move brings the European Union member nation at par with Mauritius in terms of taxing investments.
"The provisional agreement would be placed before the Union cabinet for approval, subsequent to which the new tax treaty can be signed by the two countries," the statement added.
