How Are Capital Gains Taxed Under the India-china Dtaa?

Under the India-China DTAA, capital gains are taxed as follows: Gains received from alienating an immovable property are taxed in the country where the property is situated. Gains or shares mainly tied to an immovable property are taxable in that jurisdiction. Income from the transfer of movable assets tied to a Permanent Establishment (PE) may be taxed in the state where the PE exists. Ships and aircraft involved in international traffic are taxable only in the owner's country of residence.

What Documents Do Nris Need to Claim Dtaa Benefits?

To claim the benefits of the DTAA treaty, NRIs must submit a Tax Residency Certificate (TRC) and usually Form 10F, along with proof of tax paid in the other nation.

NRI Income Tax & Compliance

Double Tax Avoidance Agreement (DTAA) Between India and China

By Manish Prajapat |Last Updated: September 26, 2025

Double Tax Avoidance Agreement (DTAA) Between India and China

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Frequently Asked Questions

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The India-China DTAA aims to help taxpayers from paying taxes twice on the same income in both countries. The agreement came into force on 21st of November 1994, and was formalized under Section 90 of the Indian Income Tax Act.

This treaty sets a uniform withholding tax rate of 10% in the source country on dividends, interest, royalties, and technical service fees.

Under the India-China DTAA, capital gains are taxed as follows:

Gains received from alienating an immovable property are taxed in the country where the property is situated.
Gains or shares mainly tied to an immovable property are taxable in that jurisdiction.
Income from the transfer of movable assets tied to a Permanent Establishment (PE) may be taxed in the state where the PE exists.
Ships and aircraft involved in international traffic are taxable only in the owner's country of residence.

A permanent establishment is a fixed place of business, such as an office, branch, or project that remains in operation for more than 183 days. Chinese business profits are not liable to taxation in India unless a permanent establishment exists here.

Yes, the India-China DTAA has been amended recently on 26th of November, 2018, on which a protocol was signed to boost information exchange in line with BEPS (Base Erosion and Profit Shifting) standards, helping limit tax evasion.

Double Tax Avoidance Agreement (DTAA) Between India and China

Frequently Asked Questions

What Is the India-China DTAA, and When Did It Come Into Effect?

What Withholding Tax Rates Apply Under the Dtaa?

How Are Capital Gains Taxed Under the India-china Dtaa?

What is Permanent Establishment (Pe) Under This Treaty?

Has the India-china Dtaa Been Amended Recently?

Double Tax Avoidance Agreement (DTAA) Between India and China

Frequently Asked Questions

What Is the India-China DTAA, and When Did It Come Into Effect?

What Withholding Tax Rates Apply Under the Dtaa?

How Are Capital Gains Taxed Under the India-china Dtaa?

What is Permanent Establishment (Pe) Under This Treaty?

Has the India-china Dtaa Been Amended Recently?