India: Treaty with South Korea, bilateral APAs, MAPs | KPMG | US
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India: Treaty with South Korea would allow bilateral APAs, MAPs

India: Treaty with South Korea, bilateral APAs, MAPs

An income tax treaty between India and South Korea includes provisions that would allow for bilateral advance pricing agreements (APAs) and mutual agreement procedures (MAPs) to resolve transfer pricing issues. The treaty was signed in May 2015, and is pending ratification and the final notification procedures before the treaty’s entry into force.


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Historically, India’s tax authorities claimed that India’s network of income tax treaties did not allow for bilateral APAs or MAPs of transfer pricing issues. This was also true for an earlier income tax treaty between India and South Korea. However, with the 2015 tax treaty between India and South Korea, there is a new provision—Article 9(2)—that would allow for the use of bilateral APAs and MAPs to resolve transfer pricing issues of taxpayers possibly encountering double taxation for India and South Korea. 


Read a September 2016 report [PDF 285 KB] prepared by the KPMG member firm in India that describes these and other provisions in the treaty

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