Notice for NRO Account holders

DTAA Benefits:-

Notice to all NRI customers availing DTAA (Double Taxation Avoidance Agreement) benefits on their NRO accounts for lower TDS benefits.

Finance Act 2012 has amended Section 90 of the Income Tax Act 1961 (Act) mentioning that non- resident requires to provide the ' Tax Residency Certificate (TRC) “ containing prescribed details issued by government authority of respective country of which the customer is a resident, to the payer to avail benefit of reduced tax under Double Taxation Avoidance Agreement (DTAA). CBDT has prescribed the contents of TRC vide notification no. 39 dated September 17, 2012. Accordingly, all non residents customers who wish to avail benefit of DTAA for FY 2012-13 and onwards have to mandatorily provide the ' Tax Residency Certificate (TRC) “ containing prescribed details to the bank for their NRO accounts / deposits. Please note that DTAA benefits cannot be given if TRC is not submitted.

Central Board of Direct Taxes (CBDT), vide Finance Act , 2012 has prescribed following contents to be captured on the Tax Residency Certificate (TRC) on the basis of which benefit of DTAA can be extended.

1. Name of the assessee;
2. Status (individual, company, firm etc.) of the assessee;
3. Nationality (in case of individual);
4. Country or specified territory of incorporation or registration (in case of person other than individual);
5. Assessee’s tax identification number in the country or specified territory of residence or in case no such number, then, a unique number on the basis of which the person is identified by the Government of the country or the specified territory;
6. Residential status for the purposes of tax;
7. Period for which the certificate is applicable; and
8. Address of the applicant for the period for which the certificate is applicable.

In case the above contents are not captured in the TRC, then the documents specified as under are also required to be provided:

1. Copy of the passport in absence of nationality.
2. Self attested copy of the tax identification number or unique number in absence of tax identification number or a unique number.
3. Document specifying the address is to be provided such as utility bill etc. incase address is not mentioned.

Please note that format of TRC is specified for your convenience so that you do not miss out any contents to be prescribed on the TRC. You should check in your country if there is any other format of TRC issued.

In case you have already submitted documents to avail of DTAA benefit or want to avail of DTAA for the current financial year 2012-2013 , you are requested to submit a latest TRC and PAN copy to avail of DTAA for the financial year 2012-2013, failing which the bank will deduct TDS on your NRO accounts at 30.9% which cannot be refunded.