{"query":"What is the India–Switzerland treaty withholding rate on royalties and fees for ","matches":[{"id":"auto_wht_switzerland","question":"What is the India–Switzerland treaty withholding rate on royalties and fees for technical services?","answer":"Royalty: 10% of the gross amount — Article 12 (combined 'Royalties and Fees for Technical Services'), India–Switzerland DTAA (as amended through 20 Aug 2026). Equipment-use royalties sit inside the royalty definition and take the same 10%. FTS: 10% — Article 12. MFN CAUTION: High-exposure MFN corridor — this is the treaty behind Nestle SA (AO Nos. incl. CA 1420/2023, SC 19 Oct 2023). Protocol para 5 (as replaced by Art 11 of the 30 Aug 2010 Amending Protocol) contains: (a) an anti-conduit rule for Arts 10/11/12/22; (b) an AUTOMATIC rate-MFN for dividends/interest/royalties/FTS, but only for treaties India signs with a state that IS an OECD member, signed AFTER 30 Aug 2010; (c) a negotiation-only scope-MFN for royalties/FTS. Commonly claimed corridors: 5% dividends via India–Lithuania/Colombia (rejected by SC — countries were not OECD members at signature and no s.90(1) notification exists) and make-available via Portugal (see fts.notes). Royalty/FTS RATE is unaffected in practice: India has signed no post-2010 OECD-member treaty below 10%, so 10% stands on the treaty's own text and needs no MFN. Retaliation: Switzerland suspended its unilateral MFN application from 1 Jan 2025 (ESTV statement, Dec 2024), so Swiss-source dividends to Indian residents revert to 10%. Gate: the treaty rate applies only through s.393(2) Sl. No. 17 → s.2(90)(c) with the s.159(8) TRC + Form 10F gate met; domestic comparator 20% + surcharge/cess (s.207(2)). Notes: Combined single Article 12 for royalties AND fees for technical services, one flat 10% rate — no equipment/general split; ICS-equipment use is inside the royalty definition at 10%; FTS definition has no make-available in treaty text; explicit carve-outs for teaching and Art 14/15 services (Art 12(5)) — unusual exclusion pair; Bifurcated MFN: automatic for rates (only post-30-Aug-2010 treaties with then-OECD members), negotiation-only for royalty/FTS scope — make-available import was never self-executing even pre-Nestle; Anti-conduit clause in protocol para 5 covering Arts 10, 11, 12 and 22 (other income) — pre-PPT treaty-shopping defence; Protocol to Art 5: service-PE income may, at the enterprise's request, be taxed at the Art 12(2) 10% gross rate instead of net Art 7 basis; Switzerland's unilateral MFN suspension from 1 Jan 2025 is asymmetric: it changes Swiss-source withholding only; India-source Art 12 flows were always 10% under the treaty text; No MLI synthesised text — treaty unmodified by MLI (no PPT); Indian domestic s.115A royalty/FTS rate is 20% plus surcharge/cess since FY 2023-24, so the 10% treaty rate (TRC + Form 10F) is the operative corridor rate.","pinpoint":"Article 12 (combined 'Royalties and Fees for Technical Services'), India–Switzerland DTAA","confidence":"verified","as_at":"14 Aug 2026","match_score":2,"treaty":"India–Switzerland"}],"engine":"deterministic","llm_in_path":false}