HMRC Double Taxation Manual DT9400 / Indian IT Act Treaty Article 23
UK-India DTAA Tax Treaty Guide
An exhaustive legal and statutory analysis of the UK-India Double Taxation Avoidance Agreement (DTAA)—covering Article 23 credit relief, NRE/NRO taxability, and SA106 filings.
Treaty Structure & Statutory Provisions (SI 1993/3123)
Bilateral Convention (1993 as amended 2013)
The Double Taxation Avoidance Agreement between the UK and India (enacted in the UK under Statutory Instrument 1993 No. 3123 and updated by the 2013 Protocol) governs the taxation of cross-border income received by residents of either contracting state.
Key articles include Article 6 (Income from Immovable Property), Article 11 (Dividends), Article 12 (Interest & Fees for Technical Services), and Article 23 (Elimination of Double Taxation via Foreign Tax Credit Relief).
Key Treaty Rates & Rules:
| Treaty Enactment | SI 1993/3123 & 2013 Protocol |
| FTCR Authority | DTAA Article 23 / TIOPA 2010 |
| Article 12 WHT Cap | 15% (Interest / FTS) |
| NRE Taxability (UK) | Taxable in UK (Arising) |
| HMRC Schedule | Self Assessment SA106 |
DTAA Foreign Tax Credit Calculator (SA106)
UK-India DTAA Calculator
Enter Indian income and TDS tax paid to calculate your DTAA credit relief under Article 23.
NRE vs NRO Account Tax Treatment
- NRE Accounts (Section 10(15) IT Act): NRE interest is tax-free in India. However, for UK tax residents, NRE interest is **fully taxable in the UK** as foreign interest income under TIOPA 2010 rules.
- NRO Accounts: NRO interest incurs 30% (+ surcharge/cess) Indian TDS. UK residents can claim this 30% TDS as FTCR against UK tax due under Article 23.
Indian Real Estate Rental Income (Article 6)
- Dual Taxation Right: Article 6 permits India to tax rental income from Indian property.
- UK Reporting: UK tax residents must report gross rental income on HMRC SA106 and claim FTCR for Indian property taxes and TDS paid.
Frequently Asked Questions (FAQ)
Yes. While NRE account interest is tax-free in India under Indian Income Tax Act Section 10(15), it is fully taxable as foreign interest income in the UK for individuals who are UK tax residents on the arising basis.
Article 23 of the UK-India DTAA allows UK tax residents to claim Foreign Tax Credit Relief (FTCR) on their HMRC SA106 tax return for Indian TDS tax paid on Indian-sourced income up to the amount of UK tax chargeable on that same income.
Under Article 12 of the UK-India DTAA, withholding tax on Royalties and Fees for Technical Services (FTS) is capped at 15%.