The document is the Legal Notice No. 147, dated July 28, 2017, which declares the Agreement between the Government of the Republic of Kenya and the Government of the Republic of India for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income. This agreement, signed on July 11, 2016, is in exercise of powers conferred by section 41 of the Income Tax Act (Cap. 470) of Kenya.Key provisions of the Agreement:

• Taxes Covered: The agreement applies to the income-tax (including any surcharge) in India (referred to as "Indian tax") and taxes on income chargeable under the Income Tax Act (Cap. 470) in Kenya (referred to as "Kenyan tax"). It also applies to identical or substantially similar taxes imposed after the date of signature.

• Fiscal Year/Year of Income: For India, the fiscal year begins on April 1st; for Kenya, the year of income begins on January 1st.

• Withholding Tax Limits (if beneficial owner is a resident of the other state):

  • Dividends: Shall not exceed 10 per cent of the gross amount.

  • Interest: Shall not exceed 10 per cent of the gross amount. Interest may be exempt from tax if derived and beneficially owned by the Government, a political subdivision, or the central banks (Reserve Bank of India, Export-Import Bank of India, and Central Bank of Kenya).

  • Royalties: Shall not exceed 10 per cent of the gross amount.

  • Fees for Management, Professional and Technical Services: Shall not exceed 10 per cent of the gross amount.

• Elimination of Double Taxation: Kenya uses the credit method, allowing a credit against the Kenyan tax for the tax paid in India. India also uses the credit method, allowing a deduction from the Indian tax for the tax paid in Kenya.

• Entry into Force: The agreement enters into force on the date of the later of the notifications of completion of required procedures.

  • It has effect in Kenya for taxes withheld at source on or after January 1st in the calendar year following completion of formalities, and for other taxes for the year of income commencing on or after January 1st in the calendar year of completion.

  • It has effect in India for income derived in any fiscal year beginning on or after April 1st next following the calendar year of entry into force.