Direct Tax Avoidance Agreements

                                                                                                                  Turkey                                                                      

Article 22 : Elimination of double taxation- 1. The laws in force in either of the Contracting States shall continue to govern the taxation of income in the respective Contracting States except where express provisions to the contrary is made in this Agreement.

2. (a) Where a resident of India derives income which, in accordance with the provisions of this Agreement, may be taxed in Turkey, India shall allow as deduction from the tax on the income of that resident an amount equal to the income-tax paid in Turkey, whether directly or by deduction. Such deduction in either case shall not, however, exceed that part of the income-tax (as computed before the deduction is given) which is attributable to the income which may be taxed in Turkey.

(b) Where a resident of India derives income which in accordance with the provisions of this Agreement, shall be taxable only in Turkey, India may include this income in the tax base but shall allow as a deduction from the income-tax that part of the income-tax which is attributable to the income derived from Turkey.

3. Double taxation for the residents of Turkey shall be eliminated as follows :

(a) Where a resident of Turkey derives income covered by sub-paragraph (b) which, in accordance with the provisions of this Agreement, may be taxed in India, Turkey shall exempt such income from tax but may, in calculating tax on the remaining income of that person, apply that rate of tax which would have been applicable if the exempted income had not been so exempted.

(b) Where a resident of Turkey derives income which in accordance with the provisions of Articles 10, 11, 12 and paragraph 6 of Article 13 of this Agreement, may be taxed in India, Turkey shall allow as a deduction from the tax on the income of that person, an amount equal to the tax paid in India.

Such deduction shall not, however, exceed, that part of the income-tax computed before the deduction is given, which is appropriate to the income which may be taxed in India.