CBDT Notification No. 39/2026 (dated 30 March 2026, gazette SO 1647(E)) brings an amending protocol to the India-Brazil Double Taxation Avoidance Agreement into effect in Indian domestic law. A protocol is a short treaty that surgically edits an existing treaty — usually to cut withholding rates, tighten the definition of a permanent establishment, add anti-abuse language and modernise the exchange-of-information article. This guide explains what a DTAA is, how an amending protocol travels from signature to entry into force, what the India-Brazil treaty says article by article, and exactly how an Indian exporter or a Brazilian payer claims the treaty rate — with the documents (TRC, Form 10F, PAN), the Section 159 (old 90) "more beneficial" rule and the Form 44 (old Form 67) foreign tax credit.
Notification No. 39/2026 is a short document with a long reach. On its face it does one narrow, technical thing: it notifies, under the treaty-relief power in Section 159 of the Income-tax Act, 2025 (the old Section 90), that an amending protocol to the India-Brazil Double Taxation Avoidance Agreement has entered into force, and it publishes the amended text so that Indian tax officers, withholding agents and taxpayers can actually apply it. But what sits behind that one line is the entire machinery of international tax: the reason India has signed more than ninety comprehensive tax treaties, the reason those treaties periodically need surgery, and the reason a change of a few percentage points in a withholding rate can decide whether an Indian software company can profitably serve a client in São Paulo. If you receive money from Brazil, pay money to Brazil, or advise anyone who does, the practical question is not "what does the notification say" but "what rate do I withhold on the next invoice, and what paperwork do I need on file to defend it". This guide answers the second question by first explaining the first.
A Double Taxation Avoidance Agreement is a bilateral treaty between two countries that allocates the right to tax cross-border income between them. It exists because two perfectly reasonable tax principles collide. Almost every country taxes its residents on their worldwide income — India does this through the residence rules in Section 6 of the Income-tax Act, 2025. Almost every country also taxes non-residents on income that arises within its borders, on the theory that the income was earned using that country's market, infrastructure and legal system. Put those two together and the same rupee of profit can be taxed twice: once by the country where it was earned, once by the country where the earner lives. An Indian engineering firm that designs a plant in Brazil is taxed by Brazil because the work was performed and paid for there, and taxed by India because the firm is Indian. Without a treaty, the combined burden can approach or exceed the profit itself, and cross-border trade simply stops being worth doing.
A DTAA solves this in a disciplined way. For each category of income — business profits, dividends, interest, royalties, fees for technical services, capital gains, shipping, employment income, pensions, government service, and so on — the treaty says which country may tax it, and how much. Sometimes the answer is "only the residence country". Sometimes it is "only the source country". Most often, and most usefully, it is "both, but the source country's tax is capped at a specified percentage, and the residence country must then give credit for whatever the source country charged". That last pattern is what produces the familiar treaty withholding rates of 10 per cent or 15 per cent on dividends, interest and royalties. India has built a network of over ninety such comprehensive agreements — with the United States, the United Kingdom, the United Arab Emirates, Singapore, Mauritius, Germany, Japan, Australia, Brazil and dozens more — precisely because that network is trade infrastructure. Every treaty lowers the friction on a specific corridor of investment and services. It is not a concession to foreigners; it is a mechanism to make Indian exporters and Indian capital competitive abroad, and to make India a predictable place for foreign capital to land.
Treaties are hard to change and slow to negotiate, which is a feature — businesses need stability — but also a problem, because the economy underneath a treaty does not stand still. The India-Brazil agreement, like most of India's older treaties, was negotiated in an era of shipping manifests and physical plant, not cloud subscriptions, digital services and multinational holding structures. Rather than tear up an agreement that is largely working and negotiate a new one from scratch — a process that can take a decade — the two governments negotiate a protocol. A protocol is itself a treaty, with the same legal force as the original, but it is written as a set of surgical edits: replace paragraph 2 of Article 11 with the following, insert a new Article 27A, delete the words "or a fixed place" in Article 5. Once in force, the protocol and the original agreement are read together as a single instrument. Some notifications, helpfully, publish a consolidated text so that practitioners are not left stitching amendments into a thirty-year-old schedule by hand.
Protocols typically do four kinds of work. First, they adjust withholding rates — reducing the cap on dividends, interest, royalties or fees for technical services to reflect changed commercial reality or to match rates the other country has conceded elsewhere. Second, they modernise definitions, most importantly the definition of a permanent establishment, which decides when a foreign business becomes taxable in the source country at all. Third, they add or strengthen anti-abuse provisions — limitation-of-benefits clauses, a principal purpose test, beneficial-ownership requirements — so that the treaty benefits residents genuinely doing business rather than shell companies interposed to harvest a lower rate. Fourth, they upgrade administrative articles, especially exchange of information and assistance in collection of taxes, which is where the global transparency agenda of the last fifteen years has left its deepest mark. A single protocol may do all four at once, which is why a document that looks like an errata sheet can materially change the after-tax economics of an entire trade corridor.
The journey from a negotiating table to a rate on an invoice has four distinct stages, and confusing them is the most common practical error taxpayers make. The first stage is negotiation and signature. Officials from the two revenue authorities agree the text; authorised representatives sign it. Signature is a political commitment and a diplomatic milestone — it is widely reported — but it changes nothing at all for a taxpayer. A signed but unratified protocol has no effect on your withholding rate, and applying a signed-not-yet-in-force rate is a straightforward way to create a short-deduction default.
The second stage is ratification, in which each country completes whatever internal constitutional process it requires to be bound. In some countries this means a parliamentary vote; in Brazil, treaty approval runs through the National Congress and a subsequent presidential decree. In India, the executive has the power to enter into treaties and the Income-tax Act supplies the domestic hook, so no separate parliamentary ratification of each treaty is needed. Each country then notifies the other, through diplomatic channels, that its procedures are complete.
The third stage is entry into force, which happens on the date the protocol itself specifies — typically the date of the later of the two diplomatic notifications, or a fixed number of days afterwards. Crucially, entry into force is not the same as the date from which the new rules apply. Nearly every treaty and protocol contains a separate effective-date rule, and it usually splits: amended withholding rules take effect for amounts paid or credited on or after the first day of the next January or the next fiscal year, while amended rules on other taxes take effect for taxable years beginning on or after that date. So a protocol in force in March may govern withholding only from the following first of April, or the following first of January, depending on the text. Reading the effective-date article carefully is not pedantry; it decides which rate is legally correct for an invoice paid in the intervening weeks.
The fourth stage, and the one Notification 39/2026 represents, is domestic notification. Under Section 159 of the Income-tax Act, 2025 (the old Sections 90 and 90A), the Central Government is empowered to enter into agreements with other countries for relief from double taxation, for exchange of information and for recovery of tax — and to make the provisions of such an agreement operative in India by notifying it in the Official Gazette. Until that gazette notification is issued, a treaty or protocol may be binding on India as a matter of international law but is not yet the operative rule that an assessing officer applies. The notification is therefore the moment the change becomes real for domestic purposes. That is why practitioners watch for the notification number and gazette reference — here, Notification No. 39/2026 dated 30 March 2026, gazette SO 1647(E) — rather than for the press release announcing signature.
The most commercially significant thing a protocol usually does is move a number. Suppose the original treaty caps source-country tax on royalties at 15 per cent and a protocol reduces it to 10 per cent. Under Indian domestic law, a person paying a sum chargeable to tax to a non-resident must deduct tax at source under Section 393 of the Income-tax Act, 2025 (the old Section 195) at the rates in force. The treaty rate, once notified, is the ceiling on what India may charge, so the Indian payer withholds at the treaty rate rather than the higher domestic rate — provided the recipient establishes entitlement to the treaty. Every rupee of that five-point reduction is a rupee that either stays with the foreign supplier or, far more often in practice, stays with the Indian payer, because cross-border service contracts are very frequently written on a grossed-up basis where the Indian customer contractually bears the withholding tax.
Consider a concrete case. An Indian manufacturer licenses process technology from a Brazilian engineering company and pays USD 500,000 a year in royalties, with the contract providing that the fee is net of Indian taxes — the Indian payer bears the withholding. At a 15 per cent treaty rate, the payer must gross up: the taxable royalty becomes USD 588,235, of which USD 88,235 goes to the Indian exchequer and USD 500,000 to Brazil. At a 10 per cent rate, the grossed-up figure is USD 555,556 and the tax is USD 55,556. The protocol has just saved the Indian licensee roughly USD 32,700 a year — around Rs 27 lakh — on a single contract, without anyone renegotiating a commercial term. Multiply that across an economy's worth of licensing, interest and technical-service payments and the fiscal arithmetic of a protocol becomes clear.
The same reduction works in the other direction for Indian exporters. An Indian IT services company billing a Brazilian bank for software maintenance faces Brazilian withholding on the fee. If the protocol lowers the cap on fees for technical services, the Brazilian payer withholds less, the Indian company receives more cash, and its Indian tax liability on the same profit is unchanged — because the foreign tax it can credit against Indian tax has fallen by exactly the amount it no longer paid. In other words, a rate cut on the source side is real money for the Indian exporter only to the extent the Indian company was in an excess-credit position, unable to fully use the foreign tax it suffered. For companies with tax holidays, carried-forward losses or an overall Indian rate lower than the foreign withholding, that excess-credit position is extremely common — which is why Indian industry lobbies hard for lower source-country caps.
India and Brazil are the two largest economies of their respective regions among the emerging markets, and their bilateral relationship — pharmaceuticals, agrochemicals, information technology, automotive components, sugar and ethanol technology, and increasingly digital services — rests on a comprehensive tax agreement of long standing. The following is how the standard articles allocate taxing rights; the protocol notified by Notification 39/2026 modifies specific paragraphs, so the operative text for any particular payment must be read from the amended treaty as notified.
Permanent establishment (Article 5) is the gatekeeper of the whole agreement. A permanent establishment is a fixed place of business through which an enterprise carries on business — a branch, an office, a factory, a workshop, a mine, and, if it lasts beyond a specified duration, a building site or installation project. A dependent agent who habitually concludes contracts on the enterprise's behalf can also create one. Preparatory or auxiliary activities — a warehouse purely for storage, an office purely for purchasing or for gathering information — generally do not. Whether an Indian company has a permanent establishment in Brazil, or a Brazilian company in India, determines whether its business profits are taxable in the other country at all. Protocols frequently tighten this article, for example by shortening the duration threshold for construction sites, by adding a services-PE rule that creates taxability when personnel furnish services in the country beyond a specified number of days, or by adding the anti-fragmentation rule developed under the BEPS project, which stops a group from slicing one taxable presence into several individually exempt fragments.
Business profits (Article 7) follow directly: the profits of an enterprise of one country are taxable only in that country, unless the enterprise carries on business in the other country through a permanent establishment there, in which case the other country may tax the profits attributable to that permanent establishment. The attribution exercise treats the permanent establishment as if it were a distinct and separate enterprise dealing at arm's length with its head office. In practice this article is the reason an Indian exporter selling goods or services into Brazil without any physical presence there is generally not subject to Brazilian tax on its trading profit, and vice versa — the great simplification the treaty delivers to ordinary trade.
Dividends (Article 10) allow the country of the paying company to tax the dividend at a capped rate — commonly 10 or 15 per cent, sometimes with a lower rate for a substantial corporate shareholding above a specified percentage of the capital — while the shareholder's residence country taxes the dividend as well and gives credit. For an Indian investor holding shares in a Brazilian company, this caps Brazilian withholding; for a Brazilian shareholder in an Indian company, it caps the Indian withholding that would otherwise apply at domestic rates under Section 393 (old 195). Since India moved to taxing dividends in the shareholder's hands, this article has become considerably more important to foreign portfolio and strategic investors than it once was.
Interest (Article 11) follows the same shared pattern with a capped source-country rate, typically 10 to 15 per cent, and usually contains exemptions for interest paid to the government, the central bank or specified public financial institutions of the other country. This article governs the cost of cross-border debt: it decides how much of an Indian borrower's coupon to a Brazilian lender is skimmed at source, and therefore feeds directly into the pricing of external commercial borrowing.
Royalties and fees for technical services (Articles 12 and, in many Indian treaties, 12 or 13) are the commercially hottest articles for the India-Brazil corridor, because so much of the trade is intellectual property and engineering knowledge. Royalties cover payments for the use of copyrights, patents, trademarks, designs, secret formulae and industrial, commercial or scientific experience, and in many Indian treaties also equipment rentals. Fees for technical services cover payments for managerial, technical or consultancy services, sometimes narrowed by a "make available" condition that requires the service to transfer the underlying skill to the recipient. The source-country cap in this article is what determines the after-tax margin on Indian software, engineering and consulting exports to Brazil, and it is the number most often moved by a protocol. Note also that Brazil has historically taken an expansive view of what constitutes technical services, so the precise wording as amended matters a great deal.
Capital gains (Article 13) allocate the right to tax gains on disposal of property. Gains on immovable property are taxable where the property is situated; gains on movable property forming part of a permanent establishment are taxable where the permanent establishment is; and gains on shares are dealt with by a specific rule, which in modern treaty practice increasingly gives the source country the right to tax gains on shares of companies deriving their value principally from immovable property in that country. Where the treaty leaves a gain taxable in India, Indian domestic rates apply — short-term capital gains on listed equity under Section 196 (the old Section 111A) and long-term capital gains on listed equity under Section 198 (the old Section 112A), among others.
Shipping and air transport (Article 8) is a rare article of near-total simplicity: profits from the operation of ships or aircraft in international traffic are generally taxable only in the country of the operator's residence or effective management. This spares carriers from filing returns in every country they touch, and it matters to the India-Brazil corridor because a substantial part of the physical trade — soya, sugar, crude, chemicals, iron ore, vehicles — moves by sea. Independent and dependent personal services articles allocate taxing rights over professionals and employees, generally sourcing employment income to the country where the work is done, subject to the familiar short-stay exemption for visits under a specified number of days paid by a non-resident employer. Non-discrimination, mutual agreement procedure and exchange of information articles complete the structure: the first prevents a country from taxing the other's nationals more heavily than its own in comparable circumstances, the second gives taxpayers a government-to-government route to resolve double taxation that survives the treaty's own rules, and the third — heavily upgraded across all treaties in the last fifteen years — is what allows revenue authorities to exchange banking and ownership information on request or automatically.
Suppose an Indian consultancy earns a fee from a Brazilian client and Brazilian tax is withheld at source. India, as the residence country, still taxes the firm's worldwide income, so the same profit is in both tax bases. The relief mechanism is a foreign tax credit: India reduces the Indian tax otherwise payable on that income by the tax already paid in Brazil, capped at the Indian tax attributable to the same income. The legal foundation is Section 159 (old 90) where a treaty exists, and Section 160 (the old Section 91) where it does not — Section 160 is India's unilateral relief provision, which gives credit even to residents earning from countries with which India has no agreement. Because a treaty exists with Brazil, Section 159 governs.
The procedural requirement is where claims are most often lost. To claim a foreign tax credit, the Indian resident must file Form 44 (the old Form 67), the statement of income earned outside India and tax paid thereon, supported by a certificate or statement of the foreign tax deducted or paid — typically the Brazilian withholding statement — and must file it in accordance with the prescribed timeline relative to the return. Failing to file the form, or filing it after the return has been processed, is a routine cause of credit denial and consequent demands, and it is entirely avoidable. The credit is computed income-stream by income-stream and is limited to the lower of the foreign tax paid and the Indian tax on that income; if the Brazilian rate exceeds the effective Indian rate on the same income, the excess is generally not refundable, which is precisely why a protocol that lowers the source rate delivers real value.
Worked example. An Indian company earns Rs 1 crore of fees from Brazil, on which Brazil withholds 15 per cent, or Rs 15 lakh. The company's Indian tax on that Rs 1 crore, at an effective corporate rate of 25 per cent, is Rs 25 lakh. It claims a credit of Rs 15 lakh through Form 44 (old Form 67) and pays Rs 10 lakh in India — total burden Rs 25 lakh, exactly what it would have paid on purely domestic income. Now suppose the company is in a concessional regime with an effective Indian rate of 15 per cent, so Indian tax is Rs 15 lakh and the credit is capped at Rs 15 lakh: it pays nothing further in India but gets no benefit from any Brazilian tax above 15 per cent. If a protocol cuts the Brazilian cap from 15 per cent to 10 per cent, the company saves the full Rs 5 lakh outright, because that tax simply is never charged. The lower the Indian effective rate, the more valuable the source-rate reduction — the mathematics that drives every treaty negotiation.
The mirror-image case is the one most Indian finance teams actually handle: an Indian company about to pay a Brazilian supplier, lender or shareholder, and having to decide what to withhold. The default is Section 393 (old Section 195), which requires deduction at the rates in force on any sum chargeable to tax paid to a non-resident. The treaty rate applies instead of the higher domestic rate only if the recipient is entitled to the treaty and has furnished the evidence.
Three documents do the work. The first is the Tax Residency Certificate, issued by the Brazilian tax authority, certifying that the recipient is a resident of Brazil for the purposes of the treaty for the relevant period. Without a TRC, the treaty rate is simply not available. The second is Form 10F, a self-declaration supplying the identifying particulars — status, nationality, tax identification number, period of residential status, address — that the TRC may not itself contain; it is now filed electronically on the Indian income-tax portal, which in turn requires the non-resident to be registered there. The third is a PAN: without one, the punitive higher-rate withholding provision can apply, though relief from that requirement is available where the non-resident furnishes the prescribed alternative particulars, including the TRC and tax identification number. Prudent payers also obtain a no-permanent-establishment declaration and, for interest and royalties, a beneficial ownership declaration, because those are the conditions the treaty itself imposes and the assessing officer will test.
Where the parties want certainty rather than a self-assessed position, two statutory routes exist. The payer or the recipient can apply for a certificate authorising deduction at a lower or nil rate under Section 395 (the old Section 197), which converts a defensible interpretation into an officer-approved instruction and eliminates the risk of being treated as an assessee-in-default. Alternatively, the non-resident can file an Indian return claiming a refund of over-withheld tax, which works but ties up cash for a year or more. For recurring payment streams — an annual licence fee, a quarterly interest coupon — the lower-deduction certificate is almost always the better instrument.
One principle sits above all of this and is worth stating precisely, because it is frequently misapplied in both directions. Section 159 (old 90) provides that where the Central Government has entered into an agreement with another country, then in relation to a taxpayer to whom that agreement applies, the provisions of the Act shall apply only to the extent they are more beneficial to that taxpayer. The taxpayer gets the better of the two regimes. If domestic law taxes royalties to a non-resident at a rate above the treaty cap, the treaty cap wins. If domestic law happens to prescribe a rate lower than the treaty cap — which does happen, since India has reduced several domestic non-resident rates over the years — then the domestic rate applies, and the payer withholds at the lower domestic rate without needing to invoke the treaty at all.
Two qualifications matter. First, you cannot cherry-pick within a single stream of income: you choose the treaty or the Act for that income, not the most favourable fragment of each. Second, the beneficial rule is a rule about rates and charge, not about procedure. Choosing the treaty rate does not excuse you from filing a return, from complying with withholding machinery, or from the documentation requirements; and treaty relief itself is conditional on the taxpayer establishing residence and, increasingly, substance and purpose. This is the point at which anti-abuse provisions bite.
The single biggest change in international tax over the past decade is that treaty benefits are no longer automatic for anyone who can produce a residence certificate. The OECD/G20 Base Erosion and Profit Shifting project concluded that a great deal of tax planning worked by routing income through entities in favourable-treaty jurisdictions that had little real presence there. Its answer was the Multilateral Instrument — a single convention that, once signed and ratified by two countries, modifies their bilateral treaties in a coordinated way without renegotiating each one. India was an early and enthusiastic signatory, and the MLI has modified a large part of its treaty network.
The MLI's most consequential export is the Principal Purpose Test. In substance it says: a benefit under the treaty shall not be granted in respect of an item of income if it is reasonable to conclude, having regard to all relevant facts and circumstances, that obtaining that benefit was one of the principal purposes of any arrangement or transaction that resulted in it — unless granting the benefit would be in accordance with the object and purpose of the relevant provisions. This is a deliberately broad standard, and it moves the analysis from formal entitlement to commercial reality. A Brazilian operating company with employees, premises, customers and its own decision-making that licenses technology to an Indian customer has nothing to fear from it. A newly incorporated intermediate holding company with no staff, inserted into a chain shortly before a large dividend, has a great deal to fear from it. The same logic drives the beneficial ownership requirement in the dividend, interest and royalty articles, and the limitation-of-benefits clauses now common in Indian treaties.
Amending protocols are one of the main vehicles by which these standards are written into individual treaties, alongside the MLI. A modern protocol will typically insert a preamble stating that the treaty is not intended to create opportunities for non-taxation or reduced taxation through treaty shopping, add a principal purpose test, tighten the permanent establishment definition against artificial avoidance, and modernise the exchange-of-information and assistance-in-collection articles. The practical consequence for taxpayers is that documentation of commercial substance has become part of the treaty claim itself. Keeping the board minutes, the employment records, the office lease and the commercial rationale for the structure is no longer housekeeping; it is the evidence base for the rate you withheld.
The disciplined response to a notification like 39/2026 is a short, concrete checklist. Identify every payment stream between your group and Brazil, in both directions, and classify each one by treaty article — royalty, fee for technical services, interest, dividend, business profit. For each stream, read the amended article as notified and determine the applicable cap, then compare it against the domestic rate to apply the more-beneficial rule under Section 159 (old 90). Read the effective-date article and fix the exact date from which the new rate applies to payments, because a rate applied a quarter early is a short deduction and a rate applied a quarter late is an over-deduction your counterparty will chase you for. Refresh your documentation file: a current TRC for the relevant period, an electronically filed Form 10F, PAN or the prescribed alternative particulars, a no-PE declaration and a beneficial-ownership declaration. Where the amounts are material or the classification is arguable, convert the position into a certificate under Section 395 (old 197) rather than defending it later in an assessment under Section 270 (the old Section 143). And on the outbound side, make sure the Brazilian withholding certificates are collected contemporaneously and the Form 44 (old Form 67) foreign tax credit claim is filed within time.
The risk in this area is asymmetric and worth naming. Under-withholding exposes the Indian payer to the tax itself, interest, and disallowance of the underlying expenditure — a triple penalty that can exceed the payment. Over-withholding costs the counterparty cash and, in grossed-up contracts, costs you cash. Misreading an effective date, relying on a signed-but-not-in-force protocol, or failing to hold a valid TRC for the correct period are the three errors that produce most of the litigation. None of them requires clever planning to avoid; they require a file.
For related reading on how treaty relief works from the individual's side — residence, the tie-breaker rules, and claiming credit as an NRI — see our detailed guide on DTAA and how to avoid double taxation as an NRI.
It notifies, in the Official Gazette under the treaty-relief power in Section 159 of the Income-tax Act, 2025 (the old Section 90), an amending protocol to the India-Brazil Double Taxation Avoidance Agreement, and publishes the amended text. That gazette notification is what makes the protocol operative in Indian domestic tax law, so that withholding agents and assessing officers can apply the amended articles. It is dated 30 March 2026 and carries gazette reference SO 1647(E).
No, and this is the most common and most expensive misunderstanding. Signature is a diplomatic commitment. The protocol must be ratified by both countries, enter into force on the date its own text specifies, and — for Indian domestic purposes — be notified in the Official Gazette. Even then, the effective-date article usually pushes the application of amended withholding rules to the start of the next calendar or fiscal year. Applying a new rate before that date is a short deduction, with interest and expenditure disallowance following.
A Tax Residency Certificate issued by the Brazilian tax authority for the relevant period, a Form 10F filed electronically on the Indian income-tax portal, and a PAN — or, where no PAN is held, the prescribed alternative particulars including the tax identification number and the TRC. Payers should also take a no-permanent-establishment declaration and, for interest, dividends and royalties, a beneficial-ownership declaration, since those are treaty conditions the officer will test.
Section 159 (old 90) provides that where a treaty applies, the provisions of the Act apply only to the extent they are more beneficial to the taxpayer. So you get the better of the treaty rate and the domestic rate for a given stream of income. You cannot mix and match within one stream, and the rule concerns rates and charge — it does not relieve you of returns, withholding machinery or documentation.
Through the foreign tax credit under Section 159 (old 90), claimed by filing Form 44 — the old Form 67 — the statement of foreign income and foreign tax paid, supported by the Brazilian withholding certificate, within the prescribed timeline relative to the return. The credit is capped at the Indian tax on the same income, so any Brazilian tax above the Indian effective rate is generally a dead cost. Where no treaty exists, unilateral relief under Section 160 (old 91) performs a similar function.
Yes. A TRC establishes residence, but modern treaties — through the MLI and through protocols like this one — carry a Principal Purpose Test, beneficial-ownership conditions and often limitation-of-benefits clauses. If it is reasonable to conclude that obtaining the treaty benefit was one of the principal purposes of the arrangement, the benefit can be denied notwithstanding the certificate. Genuine operating businesses are unaffected; conduit and shell structures are exactly the target.
Frequently, yes. Protocols often shorten the duration threshold for construction and installation projects, add a services-PE rule triggered by personnel present beyond a specified number of days, narrow the preparatory-and-auxiliary exclusions, and add anti-fragmentation and anti-commissionaire rules from the BEPS project. Since the permanent establishment article decides whether business profits are taxable in the source country at all, a tightening here can be more significant than a rate change.
Map every India-Brazil payment stream in both directions, classify each by treaty article, read the amended article and the effective-date article to fix the correct rate and start date, compare against the domestic rate under the more-beneficial rule, and refresh the TRC, Form 10F, PAN and declarations file. For material or arguable positions, obtain a lower-deduction certificate under Section 395 (old 197) rather than defending the position in a later assessment under Section 270 (old 143).
Our CAs fix the correct withholding rate under the amended treaty, assemble the TRC / Form 10F / PAN file, obtain a lower-deduction certificate under Section 395 (old 197) and file your Form 44 foreign tax credit.
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