Direct Tax Avoidance Agreements

UAR (Egypt)

Article XII - Interest - 1. Interest paid by a resident of India to a resident of the United Arab Republic may be taxed in India.

2. Interest paid by a resident of the United Arab Republic to a resident of India may be taxed in the United Arab Republic. But such Interest shall only be subject to the tax on income derived from movable capital, the defence tax, the national security tax and the supplementary taxes (which taxes shall be deducted at the source). If paid to a natural person, the general income-tax levied on the net total income may also be imposed.

3. The term interest as used in this article includes income from Government securities, bonds or debentures (exclusive of interest on debts secured by mortgages on real estate, in which case article VI shall apply) and whether or not carrying a right to participate in profits, and debt-claims of every kind as well as all other income assimilated to income from money lent by the taxation law of the State in which the income arises.

4. Interest shall be deemed to arise in a Contracting state when the payer is that State itself, a political sub-division, a local authority or a resident of that State. Where, however, the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment, then such interest shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

5. The provisions of paragraph (1) of this article in the case of the United Arab Republic shall not affect the application of article 4 of Law 14 of 1939, but the provisions of that paragraph will be applied for the purpose of elimination of double taxation in accordance with provisions of paragraph (2) of article XXIV of this Convention.