Double taxation means the same income getting taxed twice in hands of same assessee. Any country taxes income on baris of two rules i.e. residence rule & source rule
Double Taxation Avoidance Agreements is a treaty signed between two or more countries, through which the elimination of international double taxation, promotes the exchange of goods, services, and investment of capital between the two countries.
Applicable in cases where a taxpayer residing in one country must earn his/her income from another country. This implies that there are consented tax rates and jurisdiction on specified kinds of incomes arising in one country to a tax resident of another nation.
DTAA can either cover all types of income or can target a specific type of income depending upon the types of businesses/holdings of citizens of one country in another
Sections 90 and 91 under the Income Tax Act 1961 offers specific relief to taxpayers to avoid double taxation. Section 90 deals with those provisions involving taxpayers who have paid tax to another country with which India has a DTAA. Section 91 is for those countries with which India does not have a DTAA. In effect, India provides relief to both types of taxpayers.
