TAX RESIDENCE CERTIFICATE

Before explaining Tax Residence Certificate we all should know about the sections 90 & 90A i.e. Double Taxation Avoidance Agreement. Under DTAA, the Central Government enter into an agreement with the government of other countries for the purpose of granting Relief. DTAA provide relief to the residents of the contracting country to the Agreement. However, sometimes Taxpayers who were not the residents also resort to claim the benefit of relief. That’s why Section 90 & 90A are amended by Finance Act, 2012. As provided in Amended Sections 90 & 90A, now a Non-Resident can also claim relief but he can claim only if he has obtained TAX RESIDENCE CERTIFICATE (TRC) from the government of that country or specified territory declaring his residence of the country outside India or specified territory outside India.

The Tax Residence Certificate should be duly verified by the Government of the country of which the person claims to be the Resident. The Tax Residence Certificate should contain the following particulars:-

Ø  Name of the Assessee.

Ø  Status i.e. whether the Assessee is a Company, Individual, Firm etc.

Ø  Nationality.

Ø  Country or Specified Territory of Incorporation.

Ø  Assessee’s Tax Identification Number.

Ø  Residential Status.

Ø  Period for which the certificate is to be issued.

Ø  Address of the Assessee.

The submission of TRC shall be a necessary but not sufficient condition for availing benefits of the agreements referred to in these sections. Further conditions can also be stipulated for claiming treaty benefits, in addition to the requirement of submission of TRC.

An Assessee who is a Resident of India can make an Application in a form as prescribed by CBDT to the Assessing Officer for obtaining TAX RESIDENCE CERTIFICATE & Assessing Officer after receiving Application & after being satisfied in this regard shall issue a Certificate of Residence to such an Assessee.

This Article has been Shared by Student of ICAI Palak Aggarwal. She Can be reached at aggarwal.palak2809@gmail.com

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