India–Brazil tax treaty — rates, PE and MLI

The rates, at a glance

Every figure below is taken from the article named beside it, not from a rates table. Read the condition in the same row before you use the rate — in this treaty the condition is usually the whole answer.

Income	Rate	The condition attached to it	Article
Dividends	15 per cent of the gross amount in all other cases — Art. 10(2)(b), as substituted.	Three cumulative conditions, and the third is A 365-day holding period with its own carve-out which must not be truncated. The 10 per cent applies only if the beneficial owner (i) is A company (other than A…	Article 10, paragraph 2 (as substituted)
Interest	15 per cent of the gross amount in all other cases — Art. 11(2)(b), as substituted.	The exemptions sit in the article itself, at art. 11(3), and there are two limbs which operate differently. The chapeau is 'Notwithstanding the provisions of paragraphs 1 and 2' — note it displaces paragraph 1…	Article 11, paragraph 2 and 3 (both as substituted in part)
Royalties	Two tiers, and the higher one is for trademarks — which is the reverse of what most practitioners expect. Art. 12(2), as substituted: '(a) 15 per cent of the gross amount of the royalties arising from the use or the right to use trademarks; (a) 10 per cent of the gross amount of the royalties in all other cases.' The second sub-paragraph is labelled '(a)' in the text as printed where it should plainly be '(b)' — a transcription defect, but the two rates and their conditions are unambiguous. Both tiers are conditional on the beneficial owner being a resident of the other Contracting State. Trademark royalties at 15 per cent are the only rate in this treaty above 10 per cent apart from the residual dividend and interest tiers. Brand-licensing structures into or out of Brazil must be priced on 15 per cent, not 10.	Art. 12(3) is the standard wide definition — copyright of literary, artistic or scientific work (including cinematography films, films or tapes for television or radio broadcasting), patent, trade mark, design…	Article 12, paragraph 2 (as substituted)
Fees for technical services	10 per cent of the gross amount — article 12-A(2), a new stand-alone article inserted by amendment. Conditional on the beneficial owner of the fees being a resident of the other Contracting State. Note also that the rate is a flat 10 per cent with no tiering, so an FTS payment is cheaper than a trademark royalty (15 per cent) under this treaty — characterisation between Art. 12 and Art. 12-A therefore has a five-point consequence where trademarks are involved.	The treatment of this head is unusual, and IT is unusual in four separate ways. First, the article is the UN model article 12A, not the indian 'royalties and fees for technical services' hybrid. It is a…	Article 12-A, paragraph 2, 3 and 6, read with Protocol para 6

Status

In force	11 march 1992 — the Introduction records that the annexed Convention 'has been ratified and the instruments of ratification exchanged at brasilia on 11TH march, 1992 as required by Article 28 of the said Convention'. Art. 28(2) provides that the Convention enters into force upon the exchange of instruments of ratification. Signed at new delhi on 26 april 1988 'in duplicate in Hindi, Portuguese and English languages, all three texts being equally authentic. In case of any divergence of interpretation the English text shall prevail.' Note the four-year gap between signature and ratification. Effect under Art. 28(2): in India, income arising in any previous year beginning on or after 1 April immediately following the calendar year of entry into force — i.e. FY 1993-94 onwards; in Brazil, withholding taxes on amounts paid or credited on or after 1 January of the calendar year immediately following, and other taxes for the taxable year beginning on or after that date.
Given effect by	G.S.R. 381(E), dated 31-3-1992 — issued under s.90 of the Income-tax Act 1961 and section 24A of the Companies (Profits) Surtax Act 1964. The citation line reads in full: 'notification no. G.S.R. 381(E), dated 31-3-1992, as amended by notification no. S.O. 93(E) [F.no.500/101/2006-ft&tr-V], dated 4-1-2018 and notification no. S.O. 1647(E) [No. 39/2026/F. No. CBDT/1/2022-ft & tr-V section-CBDT(part-1)], dated 30-3-2026.' note that as now amended, art. 2(2) lists only 'the income tax including any surcharge thereon' for India and 'in federal income tax' for Brazil — the surtax has dropped out of the substituted article, and the Brazilian entry carries a stray 'in' as printed. Protocol paragraph 2 extends the brazilian side: 'in the case of Brazil the social contribution on the net profits (Contribuição Social sobre o Lucro Líquido, csll) created by Law 7,689 of 15 December, 1988 is included in the taxes referred to' — though the Protocol's cross-reference is to 'subparagraph a) of paragraph 2 of Article 2', which is the indian limb; Brazil is sub-paragraph (b). That is a defective cross-reference in the notified text.
Modified by the MLI	No synthesised text was found for this treaty in the source searched.
Principal purpose test	Yes — art. 26-A(9), in exactly the MLI art. 7(1) words, adopted bilaterally: 'Notwithstanding the other provisions of this Convention, a benefit under this Convention 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 directly or indirectly in that benefit, unless IT is established that granting that benefit in these circumstances would be in accordance with the object and purpose of the relevant provisions of this convention.' which paragraphs of an existing anti-abuse article did IT replace? None — and the question is differently shaped here from Malta's. This treaty had no anti-abuse article before the amendment; the PPT arrived as paragraph 9 of a brand-new Article 26-A, alongside the simplified LOB in paragraphs 1 to 7 and the third-jurisdiction rule in paragraph 8. Nothing was struck out and no residual paragraph of an older article survives behind it. The PPT and the LOB operate cumulatively, not alternatively: paragraph 9 opens 'Notwithstanding the other provisions of this convention', which includes the rest of Article 26-A, so a resident that is a qualified person under paragraph 2 can still be denied a benefit under paragraph 9. Brazil is therefore the only treaty in this batch with both A full objective LOB and A PPT, and both were achieved without the MLI.

Dividends

Rate	15 per cent of the gross amount in all other cases — Art. 10(2)(b), as substituted.
Lower rate on a qualifying holding	10 per cent of the gross amount — Art. 10(2)(a), as substituted.
The holding that unlocks it	Three cumulative conditions, and the third is A 365-day holding period with its own carve-out which must not be truncated. The 10 per cent applies only if the beneficial owner (i) is A company (other than A partnership) — partnerships are expressly shut out; (ii) holds directly at least 20 per cent of the capital of the company paying the dividends — 'directly' excludes indirect holdings, 'capital' is a capital test not a voting test, and the threshold is 20 per cent, not the more usual 10 or 25; and (iii) has so held 'throughout A 365 day period that includes the day of the payment of the dividend'. The parenthesis that follows is the carve-out: '(for the purpose of computing that period, no account shall be taken of changes of ownership that would directly result from A merger or divisive reorganisation, or from A change of legal form, of the company that holds the shares or that pays the dividend)'. So an intra-group reorganisation does not reset the 365-day clock. Note the period 'includes the day of payment' — it need not end on that day, so a holding acquired before and continuing after the payment date qualifies once 365 days are complete. Both tiers are conditional on the recipient being the beneficial owner and a resident of the other Contracting State. This is the MLI Art. 8 rule adopted bilaterally.
Where this comes from	Article 10, paragraph 2 (as substituted)

Art. 10(5) is A brazilian branch-profits withholding permission and IT is one-directional: 'Where a resident of India has a permanent establishment in Brazil, this permanent establishment may be subject to A tax withheld at source in accordance with Brazilian law. However, such a tax cannot exceed 15 per cent of the gross amount of the profits of that permanent establishment determined after the payment of the corporate tax related to such profits.' There is no reciprocal Indian limb. Protocol paragraph 8(a) confirms that Art. 10(5) 'are not in conflict with the provisions of paragraph 2 of Article 24' — the non-discrimination article cannot be used against it. Art. 10(3) is a wide dividend definition covering jouissance shares and rights, mining shares and founders' shares. Art. 10(4) (as substituted) is the effectively-connected carve-out referring income to Art. 7 or Art. 14; the text as printed reads 'effectivelyconnected' as one word. Art. 10(6) (as substituted) is the extra-territorial-taxation bar.

Interest

Rate	15 per cent of the gross amount in all other cases — Art. 11(2)(b), as substituted.
Exemptions	The exemptions sit in the article itself, at art. 11(3), and there are two limbs which operate differently. The chapeau is 'Notwithstanding the provisions of paragraphs 1 and 2' — note it displaces paragraph 1 as well as paragraph 2, which is wider than the usual formula. Limb (a), as substituted — 'interest arising in Contracting State and paid to the government of the other Contracting State, A political sub-division or local authority thereof, the central bank or any agency (including A financial institution) wholly owned by that government or political subdivision shall be exempt from tax in the first-mentioned State, unless sub-paragraph (b) applies'. Three points. The central bank is expressly named, generically, on both sides. The 'any agency (including a financial institution) wholly owned by that Government or political subdivision' limb is functional rather than a closed list of named institutions — contrast the Czech, Malta, Hungary and Kenya treaties, which all name specific banks and are therefore stranded when those banks merge or are renamed. Brazil's formulation follows the successor entity automatically, provided wholly-owned status survives. And the closing words 'unless sub-paragraph (b) applies' subordinate limb (a) to limb (b) — they are not alternatives to be chosen; (b) takes priority where it is engaged. Limb (b) — 'interest from securities, bonds or debentures issued by the government of a Contracting State, a political sub-division thereof or any agency (including a financial institution) wholly owned by that Government or political sub-division shall be taxable only in that state.' Note the different mechanism: (a) grants an exemption in the source State to a government recipient; (b) allocates exclusive taxing rights to the issuing State over interest on government paper. Where government paper is held by a government body of the other State, (b) governs and the result is that only the issuing State may tax. There is no 'any other institution as may be agreed' limb and no exchange-of-letters mechanism — none is needed, because limb (a) is drafted functionally. Penalty charges for late payment are not expressly excluded from the definition of interest — the usual closing sentence of the definition is absent from Art. 11(4).
Where this comes from	Article 11, paragraph 2 and 3 (both as substituted in part)

The lower tier is unusually narrow and all three of its conditions must be met. Art. 11(2)(a): '10 per cent of the gross amount of the interest if the beneficial owner is A bank and the loan has been granted for at least five years for the financing of the purchase of equipment or of investment projects'. So: the beneficial owner must be A bank (not merely a financial institution — compare Turkey's 'a bank or A financial institution'); the loan must have been granted for at least five years; and its purpose must be the financing of the purchase of equipment or of investment projects. A five-year working-capital facility from a bank does not qualify; nor does a three-year equipment loan. Everything else is at 15 per cent. Art. 11(6) is A triangular anti-abuse rule and it is easy to miss: 'The tax rate limitation provided for in paragraph 2 shall not apply to interest arising in a Contracting State and paid to A permanent establishment of an enterprise of the other Contracting State which is situated in A third state if such interest is effectively taxed at A lower rate in the other State than it would be if the interest was directly paid to the enterprise of that other State.' Where it bites, the source State's domestic rate applies with no treaty cap at all. Protocol paragraph 5 extends the interest definition in A way that matters commercially: 'interest paid as interest on the company'S equity (juros sobre O capital PRÓPRIO in Portuguese) in accordance with Brazilian tax law is also considered interest for the purposes of paragraph 4 of Article 11.' Brazil's jcp is a deductible notional return on equity that resembles a dividend economically; the Protocol settles its treaty character as interest, so it attracts Art. 11 (15 per cent, or 10 per cent if the narrow bank condition is met) and not Art. 10. Art. 11(7) is the source rule in the narrow form — 'when the payer is A resident of that State' — with the PE/fixed-base deeming override.

Royalties

Rate	Two tiers, and the higher one is for trademarks — which is the reverse of what most practitioners expect. Art. 12(2), as substituted: '(a) 15 per cent of the gross amount of the royalties arising from the use or the right to use trademarks; (a) 10 per cent of the gross amount of the royalties in all other cases.' The second sub-paragraph is labelled '(a)' in the text as printed where it should plainly be '(b)' — a transcription defect, but the two rates and their conditions are unambiguous. Both tiers are conditional on the beneficial owner being a resident of the other Contracting State. Trademark royalties at 15 per cent are the only rate in this treaty above 10 per cent apart from the residual dividend and interest tiers. Brand-licensing structures into or out of Brazil must be priced on 15 per cent, not 10.
Where this comes from	Article 12, paragraph 2 (as substituted)

Rate

Two tiers, and the higher one is for trademarks — which is the reverse of what most practitioners expect. Art. 12(2), as substituted: '(a) 15 per cent of the gross amount of the royalties arising from the use or the right to use trademarks; (a) 10 per cent of the gross amount of the royalties in all other cases.' The second sub-paragraph is labelled '(a)' in the text as printed where it should plainly be '(b)' — a transcription defect, but the two rates and their conditions are unambiguous. Both tiers are conditional on the beneficial owner being a resident of the other Contracting State. Trademark royalties at 15 per cent are the only rate in this treaty above 10 per cent apart from the residual dividend and interest tiers. Brand-licensing structures into or out of Brazil must be priced on 15 per cent, not 10.

Where this comes from

Article 12, paragraph 2 (as substituted)

Art. 12(3) is the standard wide definition — copyright of literary, artistic or scientific work (including cinematography films, films or tapes for television or radio broadcasting), patent, trade mark, design or model, plan, secret formula or process, use of or right to use industrial, commercial or scientific equipment (the text as printed reads 'the light to use' for 'the right to use'), and information concerning industrial, commercial or scientific experience. Protocol paragraph 8(b) preserves brazilian deductibility limits against A non-discrimination challenge: 'the provisions of the brazilian tax law on the limitation of deductibility of royalties, as defined in paragraph 3 of Article 12, while determining taxable income of a permanent establishment under paragraph 3 of Article 7 are not in conflict with the provisions of paragraph 2 of Article 24.' Brazil caps royalty deductions by statute; the Protocol confirms the cap survives Art. 24(2). Art. 12(4) and (5), as substituted, are the effectively-connected carve-out and the source rule.

Fees for technical services

Rate	10 per cent of the gross amount — article 12-A(2), a new stand-alone article inserted by amendment. Conditional on the beneficial owner of the fees being a resident of the other Contracting State. Note also that the rate is a flat 10 per cent with no tiering, so an FTS payment is cheaper than a trademark royalty (15 per cent) under this treaty — characterisation between Art. 12 and Art. 12-A therefore has a five-point consequence where trademarks are involved.
Make-available requirement	No
Where this comes from	Article 12-A, paragraph 2, 3 and 6, read with Protocol para 6

The treatment of this head is unusual, and IT is unusual in four separate ways. First, the article is the UN model article 12A, not the indian 'royalties and fees for technical services' hybrid. It is a free-standing article 12-A, inserted between Articles 12 and 13, with seven paragraphs of its own — its own charging paragraph, its own definition, its own PE carve-out, two source rules, and its own excess-payment rule. India has this architecture in very few of its treaties. Second, there is no make-available limb. Art. 12-A(3): 'The term fees for technical services as used in this Article means any payment in consideration for any service of A managerial, technical or consultancy nature, unless the payment is made: (a) to an employee of the person making the payment; (b) for teaching in an educational institution or for teaching by an educational institution; or (c) by an individual for services for the personal use of an individual.' The words 'make available', 'enable', 'technical plan' and 'technical design' appear nowhere in the Convention or the Protocol — verified by full-text search. Managerial services are expressly included. The definition is drafted as a wide rule with three narrow exceptions, and the three exceptions are the UN model's exactly. Third — and this is the provision most likely to be missed — protocol paragraph 6 extends the article to technical assistance: 'It is understood that the provisions of paragraph 3 of Article 12-A shall apply to payments of any kind received as consideration for the rendering of technical assistance.' Brazilian domestic practice distinguishes 'serviços técnicos' from 'assistência técnica', and Brazil has historically sought to tax technical-assistance payments under royalty articles. The Protocol paragraph settles the point bilaterally: technical assistance is FTS under Art. 12-A, not royalties under Art. 12, and so attracts 10 per cent rather than the trademark tier. Fourth, the source rule has A negative limb that reverses the usual outcome. Art. 12-A(5) is the ordinary positive rule (fees arise where the payer is resident, or where a PE or fixed base bearing the fees is situated), but it is expressly 'subject to paragraph 6', and art. 12-A(6) provides that fees shall be deemed **not** to arise in A contracting state 'if the payer is A resident of that state and carries on business in the other contracting state through A permanent establishment situated in that other state or performs independent personal services through a fixed base situated in that other State and such fees are borne by that permanent establishment or fixed base.' So where an Indian company pays technical fees that are borne by its own Brazilian PE, the fees are deemed not to arise in India, and India loses the source taxing right it would otherwise have under the residence-of-payer limb. Art. 12-A(2) also opens with an ordering rule: it applies 'notwithstanding the provisions of article 14 and subject to the provisions of articles 8, 16 and 17' — so Art. 12-A overrides the independent personal services article (unlike the Kenya, Czech, Malta and Hungary treaties, where Art. 14/15 payments are excluded from the FTS definition), but yields to shipping and air transport (Art. 8), directors' fees (Art. 16) and artistes and sportspersons (Art. 17). The combined effect: an individual Brazilian consultant's fee is caught by Art. 12-A at 10 per cent gross even if he has no fixed base in India and stays under 183 days, because Art. 12-A(2) trumps Art. 14. That is the opposite of the position under every other treaty in this batch that has an FTS provision. There is no MFN clause (see practitioner_notes) so no make-available limb can be imported.

Capital gains on shares

Treatment	Full source-state taxing right over all share gains, and A residual paragraph that gives both states A taxing right over everything else. Article 13, as substituted, has five paragraphs. Art. 13(4) is a single unqualified sentence: 'Gains from the alienation of shares in A company which is A resident of A contracting state may be taxed in that state.' No property-rich test, no percentage, no minimum holding, no listing carve-out, no de minimis and — notably — no separate immovable-property-rich paragraph at all, because none is needed once every share is caught. India may tax a Brazilian resident's gain on shares of an Indian company in every case. Then comes the paragraph that has no counterpart in any other treaty in this batch. Art. 13(5): 'Gains from the alienation of any property other than that referred to in paragraphs 1, 2, 3 and 4 may be taxed in both contracting states.' Every other treaty in this batch closes Article 13 with a residual paragraph making such gains 'taxable only in the Contracting State of which the alienator is a resident'. Brazil's residual does the opposite: it expressly confers a taxing right on both States, so there is no residence-only category of capital gains under this treaty at all. Any gain not within paras 1 to 4 — a debt instrument, a partnership interest, an intangible, a derivative, a business asset outside a PE — is taxable in the source State as well as the residence State, with relief coming only through the Art. 23 credit. Art. 13(3) allocates ship and aircraft gains exclusively to the State of the operating enterprise.
Grandfathering	None — and note carefully that Article 13 was substituted in its entirety by amendment, with no transitional or grandfathering provision attached. The substituted Article carries an amendment marker over the whole article; no commencement rule for the substitution is given beyond the effect of the notifying instrument itself. There is no shares-acquired-before date, no transition rate and no limitation-of-benefits gateway attached to Article 13 — although Art. 26-A applies generally to all benefits of the Convention, including anything a taxpayer might seek to claim under Art. 13.
Conditions	Art. 13(4) is unconditional on its face. The real conditions on any Article 13 claim come from article 26-A: a resident who is not a 'qualified person' under Art. 26-A(2), and who cannot bring itself within the active-business test in Art. 26-A(3), the derivative-benefits test in Art. 26-A(4) or the competent-authority discretion in Art. 26-A(5), is denied the benefit; and the PPT in Art. 26-A(9) applies to it in any event. Note the drafting of Art. 13(2): it covers movable property of a PE or of a fixed base 'for the purpose of performing independent services' — the word 'personal' has dropped out of the substituted text.
Where this comes from	Article 13, paragraph 4 and 5 (as substituted)

Permanent establishment

Construction or installation PE	More than six months, with A full anti-splitting rule that has A 30-day de minimis. Art. 5(2)(g) includes in the term permanent establishment 'a building site or construction or assembly project which exists for more than six months' — note it does not mention installation and does not mention supervisory activities. Art. 5(4) then supplies the aggregation rule, and it must be read in full because its structure is conditional: 'For the sole purpose of determining whether the six month period referred to in sub-paragraph (g) of paragraph 2 has been exceeded, (a) where an enterprise of a Contracting State carries on activities in the other Contracting State at a place that constitutes a building site or construction or assembly project and these activities are carried on during one or more periods of time that, in the aggregate, exceed 30 days without exceeding six months, and; (b) connected activities are carried on at the same building site or construction or assembly project during different periods of time, each exceeding 30 days, by one or more enterprises closely related to the first-mentioned enterprise, these different periods of time shall be added to the period of time during which the first-mentioned enterprise has carried on activities at that building site or construction or assembly project.' Both (a) and (b) must be satisfied; a related enterprise's spell of 30 days or less is not aggregated; and the aggregation operates only for the six-month test in para 2(g), not for any other purpose. This is MLI Art. 14 adopted bilaterally. 'Closely related' is defined in Art. 5(9) — control, or more than 50 per cent of the beneficial interest, or in the case of a company more than 50 per cent of the aggregate vote and value.
Service PE	Yes — more than 183 days in any 12-month period. Art. 5(3): 'The term permanent establishment also encompasses the furnishing of services, including consultancy services, by an enterprise through employees or other personnel engaged by the enterprise for such purpose, but only if activities of that nature continue within a Contracting State for a period or periods aggregating more than 183 days in any 12-month period commencing or ending in the fiscal year concerned.' 183 days is generous by comparison with malta and kenya (90 days each) — but note two differences that cut the other way: this limb has no 'for the same or connected project' restriction, so all service activity of that nature in the State is aggregated regardless of project; and the 12-month window is rolling but anchored to the fiscal year. The absence of the same-or-connected-project qualifier makes the 183-day test easier to trip than the day count alone suggests. And because Art. 12-A taxes technical fees at 10 per cent gross whether or not a PE exists, crossing the service PE threshold changes the basis of taxation (net under Art. 7 instead of gross under Art. 12-A) rather than creating liability where none existed.
Agency PE	Yes — and IT is the full post-beps commissionnaire rule, adopted bilaterally. Art. 5(6): a PE arises where a person acting on behalf of an enterprise 'habitually concludes contracts, or habitually plays the principal role leading to the conclusion of contracts that are routinely concluded without material modification by the enterprise', and those contracts are '(a) in the name of the enterprise, or (b) for the transfer of the ownership of, or for the granting of the right to use, property owned by that enterprise or that the enterprise has the right to use, or (c) for the provision of services by that enterprise' — subject to the exception where the person's activities are limited to those in para 5 read with para 5.1. Limb (b) catches undisclosed-principal and commissionnaire structures; limb (c) catches service contracts. Art. 5(7) is the independent-agent exclusion in its post-beps form: it does not apply where 'a person acts exclusively or almost exclusively on behalf of one or more enterprises to which IT is closely related' — note the plural, so an agent acting for several related principals cannot aggregate them to claim independence, and note that exclusivity alone defeats independence here, with no additional arm's-length requirement.
Where this comes from	Article 5 (substituted in its entirety)

Article 5 as substituted is the most modern PE article in this batch and IT contains both beps action 7 options. Art. 5(5) is the 'option A' exclusion list: each of limbs (a) to (f) is now subject to a closing proviso — 'provided that such activity or, in the case of sub-paragraph (f), the overall activity of the fixed place of business, is of A preparatory or auxiliary character'. So storage, display, stock-holding, purchasing and information-collecting are no longer unconditionally excluded; each must independently be shown to be preparatory or auxiliary. Note also that limb (e) has been reduced to 'any other activity' with the preparatory-or-auxiliary test moved into the proviso, and that limbs (a) and (b) cover 'storage or display' only — delivery is not excluded at all. Art. 5(5.1) is the anti-fragmentation rule: para 5 does not apply to a fixed place used or maintained by an enterprise if the same or a closely related enterprise carries on business at the same or another place in the same State and either that place is a PE or the combined activity is not preparatory or auxiliary — provided the activities 'constitute complementary functions that are part of A cohesive business operation'. Art. 5(9) supplies the 'closely related' definition for the whole article. There is no insurance PE and no warehouse, sales-outlet or farm limb — Art. 5(2) is the short six-limb list. Art. 4(3), also substituted, matters for any dual-resident entity: the tie-breaker is place of effective management, but if that cannot be determined the competent authorities 'shall endeavour to settle the question by mutual agreement' and 'in the absence of such agreement, such person shall not be entitled to any relief or exemption from tax provided by this convention except to the extent and in such manner as may be agreed upon by the competent authorities'. Art. 4(1) also expressly brings in 'legal head office' and 'place of incorporation' as residence criteria and includes the State and its subdivisions and local authorities as residents.

Anti-abuse: limitation of benefits, and the MLI

LOB	Yes — article 26-A, 'entitlement to benefits', and IT is by A long way the most developed anti-abuse article in this batch. It is the beps simplified limitation on benefits (MLI Art. 7(8)-(13)) adopted bilaterally, with the third-jurisdiction PE rule and the PPT bolted on. Structure: para 1 — a resident is denied any benefit (other than under Art. 4(3) or Art. 25 map) unless it is a qualified person at the time the benefit would be accorded. Para 2 — the qualified-person list: (a) an individual; (b) the Contracting State, a political subdivision or local authority, or an agency or instrumentality thereof; (c) a company or other entity whose principal class of shares is regularly traded on one or more recognised stock exchanges; (d) a non-profit organisation agreed upon by the competent authorities — note this limb is not self-executing and requires competent-authority agreement; and (e) an ownership test — a person other than an individual if, at that time and on at least half of the days of A twelve-month period that includes that time, residents of that State qualifying under (a) to (d) own directly or indirectly at least 50 per cent of its shares. Note there is no base-erosion test attached to limb (e), which is a simplification relative to the full US-style LOB. Para 3 — the active conduct of A business test, available regardless of qualified-person status, with a hard exclusion list: 'the term active conduct of A business shall not include (i) operating as A holding company; (ii) providing overall supervision or administration of A group of companies; (iii) providing group financing (including cash pooling); or (iv) making or managing investments, unless these activities are carried on by a bank or financial institution agreed upon by the competent authorities, insurance enterprise or registered securities dealer in the ordinary course of its business as such'. Limb (i) alone shuts most holding structures out of the active-business route. Para 3(b) adds a substantiality test where the income comes from a business activity conducted in the other State or from a connected person. Para 4 — derivative benefits, at a high threshold: benefits are available if equivalent beneficiaries own directly or indirectly at least 75 per cent of the shares, at the relevant time and on at least half the days of a twelve-month period. Para 5 — competent-authority discretionary relief, available only if the resident 'demonstrates to the satisfaction of such competent authority that neither its establishment, acquisition or maintenance, nor the conduct of its operations, had as one of its principal purposes the obtaining of benefits'; the burden is expressly on the taxpayer, and the competent authority approached must consult the other before granting or denying. Para 6 — definitions of recognised stock exchange, shares, principal class of shares, connected persons (50 per cent) and equivalent beneficiary. Para 7 — competent authorities may settle the mode of application by mutual agreement. Para 8 — a third-jurisdiction permanent establishment rule (MLI Art. 10): where an enterprise's income is attributed to a PE in a third jurisdiction whose profits are exempt in the residence State, benefits are denied on any item on which third-jurisdiction tax is less than the lower of 15 per cent of the item and 60 per cent of the tax the residence state would have imposed — with an active-business carve-out in para 8(b) and a competent-authority escape in para 8(c).
PPT	Yes — art. 26-A(9), in exactly the MLI art. 7(1) words, adopted bilaterally: 'Notwithstanding the other provisions of this Convention, a benefit under this Convention 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 directly or indirectly in that benefit, unless IT is established that granting that benefit in these circumstances would be in accordance with the object and purpose of the relevant provisions of this convention.' which paragraphs of an existing anti-abuse article did IT replace? None — and the question is differently shaped here from Malta's. This treaty had no anti-abuse article before the amendment; the PPT arrived as paragraph 9 of a brand-new Article 26-A, alongside the simplified LOB in paragraphs 1 to 7 and the third-jurisdiction rule in paragraph 8. Nothing was struck out and no residual paragraph of an older article survives behind it. The PPT and the LOB operate cumulatively, not alternatively: paragraph 9 opens 'Notwithstanding the other provisions of this convention', which includes the rest of Article 26-A, so a resident that is a qualified person under paragraph 2 can still be denied a benefit under paragraph 9. Brazil is therefore the only treaty in this batch with both A full objective LOB and A PPT, and both were achieved without the MLI.
Subject to tax	Not as A general condition, but there are two subject-to-tax-like mechanisms. First, art. 26-A(8) is an effective-rate test — benefits are denied where third-jurisdiction PE income bears tax below the lower of 15 per cent of the item and 60 per cent of the residence State's tax. Second, art. 4(3) denies all relief to a dual-resident non-individual whose place of effective management cannot be determined and on which the competent authorities cannot agree. Separately, protocol paragraph 1 is A broad domestic-law saving: 'It is understood that the provisions of this Convention shall in no case prevent A contracting state from the application of the provisions of its domestic laws and measures concerning tax avoidance or evasion, whether or not described as such.' The closing words are wide enough to preserve Indian Chapter X-A GAAR, s.94A and s.94B, and specific anti-avoidance provisions that do not label themselves as such. Also note art. 1(2), inserted by amendment: 'This Convention shall not affect the taxation, by a Contracting State, of its residents except with respect to the benefits granted under articles 19, 20, 21, 23, 24, 25 and 27' — the MLI Art. 11(1) saving clause, adopted bilaterally.
Where this comes from	Article 26-A (paras 1-7 simplified LOB, para 8 third-jurisdiction PE rule, para 9 PPT); Art. 1(2) saving clause; Protocol para 1 domestic-law saving; Art. 4(3) dual-resident denial

No synthesised text for brazil has been identified from the sources used here. So there is only one text and nothing to reconcile. But — and this is the point that distinguishes brazil from every other MLI-less treaty in this batch — the absence of an MLI overlay costs nothing here, because india and brazil put the entire beps package into the treaty bilaterally by protocol. Everything the MLI would have supplied is already in the amended text, and in most cases in a stronger form: the MLI Art. 6(1) anti-treaty-shopping preamble is the substituted preamble; the MLI Art. 11(1) saving clause is the inserted Art. 1(2); MLI Art. 13(4) anti-fragmentation is Art. 5(5.1); MLI Art. 15(1) 'closely related' is Art. 5(9); MLI Art. 14 splitting-up-of-contracts is Art. 5(4), with a 30-day de minimis; MLI Art. 12 commissionnaire is Art. 5(6) with its full three-limb contract test and Art. 5(7)'s exclusivity rule; MLI Art. 7(1) PPT is Art. 26-A(9); MLI Art. 7(8)-(13) simplified LOB is Art. 26-A(1)-(7); MLI Art. 10 (third-jurisdiction permanent establishments) is Art. 26-A(8); MLI Art. 8 (the 365-day dividend holding period) is inside Art. 10(2)(a). Brazil is therefore the most beps-compliant treaty in this batch despite having no synthesised text at all. Note also that Brazil is not an MLI signatory; the bilateral protocol route was the only one available. The only MLI item not replicated is the MLI Art. 9(4) 365-day look-back for immovable-property-rich share gains — and that is because Art. 13(4) already gives the source State an unrestricted right over all share gains, so a property-rich test would add nothing.

The protocols, in order

A treaty read without its protocols is a wrong answer.

S.O. 93(E) [F. No. 500/101/2006-ft&tr-V], dated 4-1-2018 — the first amending notification.
S.O. 1647(E) [No. 39/2026 / F. No. CBDT/1/2022-ft & tr-V section-CBDT(part-1)], dated 30-3-2026 — the second amending notification, and a very recent one: it is five months old at the date of this reading. This treaty has been comprehensively rebuilt.
Scale of the amendment — the marker count tells the story. The notified text carries twenty-seven bracketed amendment markers (22 numbered '1', 3 numbered '2', 2 numbered '3'). Substituted in their entirety: the preamble, article 2 (Taxes Covered), article 3 (General Definitions), article 4 (Resident), article 5 (Permanent Establishment), article 8 (Shipping and Air Transport), article 13 (Capital Gains), article 14 (Independent Personal Services), article 17 (Artistes and Sportspersons), article 23 (Methods for the Elimination of Double Taxation), article 26 (Exchange of Information) and the whole protocol. Inserted: article 1(2) (the saving clause), article 12-A (fees for technical services) and article 26-A (entitlement to benefits). Substituted paragraph by paragraph: Art. 10 paras 2, 4 and 6; Art. 11 paras 2, 3(a) and 5 to 7; Art. 12 paras 2, 4 and 5; Art. 15 para 2; Art. 18 para 2; Art. 24 para 2; Art. 25 para 1.
Which notification made which change cannot be established from the sources used here, and I will not guess beyond what the text supports. The text behind each footnote bracket is not available here, and the numbering restarts within each article (Article 10 carries footnotes 1, 2 and 3; Article 11 carries 1, 2 and 3; Article 12 carries 1 and 2), so the marker number identifies the footnote within the article, not the instrument. What the text itself supports: the substituted Article 26 is the modern foreseeably-relevant exchange-of-information article of the kind India notified across its network around 2017-18, and Protocol paragraph 1 (the domestic anti-avoidance saving) is of the same vintage — those are consistent with S.O. 93(E) of 4-1-2018. Everything that is recognisably beps-derived — the anti-treaty-shopping preamble, the Art. 1(2) saving clause, the rebuilt Art. 5 with anti-fragmentation, splitting-up-of-contracts and the commissionnaire rule, the new Art. 12-A, the new Art. 26-A with simplified LOB plus PPT, and the 365-day holding condition in Art. 10(2)(a) — must post-date the beps package and is consistent with S.O. 1647(E) of 30-3-2026, whose file number is a 2022 CBDT file. That attribution is A reasoned inference from the content, not something stated in the sources used here. See gaps.
No synthesised text exists — and, uniquely in this batch, that does not matter. See synthesised_text.

The words themselves

Quoted from the treaty as notified.

Gains from the alienation of any property other than that referred to in paragraphs 1, 2, 3 and 4 may be taxed in both Contracting States.

Article 13, paragraph 5 (as substituted) of the treaty as notified.

The term "fees for technical services" as used in this Article means any payment in consideration for any service of a managerial, technical or consultancy nature, unless the payment is made: (a) to an employee of the person making the payment; (b) for teaching in an educational institution or for teaching by an educational institution; or (c) by an individual for services for the personal use of an individual.

Article 12-A, paragraph 3 of the treaty as notified.

It is understood that the provisions of paragraph 3 of Article 12-A shall apply to payments of any kind received as consideration for the rendering of technical assistance.

Article Protocol, paragraph 6 of the treaty as notified.

10 per cent of the gross amount of the dividends if the beneficial owner is a company (other than a partnership) which holds directly at least 20 per cent of the capital of the company paying the dividends throughout a 365 day period that includes the day of the payment of the dividend (for the purpose of computing that period, no account shall be taken of changes of ownership that would directly result from a merger or divisive reorganisation, or from a change of legal form, of the company that holds the shares or that pays the dividend)

Article 10, paragraph 2(a) (as substituted) of the treaty as notified.

10 per cent of the gross amount of the interest if the beneficial owner is a bank and the loan has been granted for at least five years for the financing of the purchase of equipment or of investment projects

Article 11, paragraph 2(a) (as substituted) of the treaty as notified.

It is understood that, in respect of paragraph 4 of Article 11, interest paid as "interest on the company's equity" ("juros sobre o capital proprio" in Portuguese) in accordance with Brazilian tax law is also considered interest for the purposes of paragraph 4 of Article 11.

Article Protocol, paragraph 5 of the treaty as notified.

For the purposes of this Article, fees for technical services shall be deemed not to arise in a Contracting State if the payer is a resident of that State and carries on business in the other Contracting State through a permanent establishment situated in that other State or performs independent personal services through a fixed base situated in that other State and such fees are borne by that permanent establishment or fixed base.

Article 12-A, paragraph 6 of the treaty as notified.

the term "active conduct of a business" shall not include the following activities or any combination thereof: (i) operating as a holding company; (ii) providing overall supervision or administration of a group of companies; (iii) providing group financing (including cash pooling); or (iv) making or managing investments

Article 26-A, paragraph 3(a) of the treaty as notified.

What to watch

This is now A beps-era treaty wearing A 1988 convention'S numbering, and any answer given from A pre-2026 source is likely to be wrong. Twenty-seven amendment markers; twelve articles and the whole Protocol substituted; three articles or paragraphs newly inserted. Anyone working from the treaty as it stood before S.O. 1647(E) of 30-3-2026 will miss Article 12-A (fees for technical services), Article 26-A (entitlement to benefits), the rebuilt Article 5, the 365-day dividend holding condition and the substituted Article 13. This is the opposite of the poland problem: here it is the current record that carries the amendments and there is no second record to check against — but the risk is the same in kind, because an older copy of the treaty would serve provisions that no longer stand.
No most-favoured-nation clause. A full-text search of the whole record returned no hit for 'most favoured', 'most-favoured' or 'OECD' anywhere in the Convention or the substituted eight-paragraph Protocol. Nothing is tied to a later Indian treaty; nothing covers scope; no notification has ever been or could be issued under such a clause. The make-available argument therefore has no textual foundation under the Brazil treaty. That matters less than usual, because the FTS rate is already 10 per cent — but it does mean the scope of Article 12-A, which is very wide and expressly extends to technical assistance by Protocol paragraph 6, cannot be narrowed by reference to any other Indian treaty.
The four rate articles do not move together and characterisation is worth real money. Dividends 10 or 15 per cent depending on a 20 per cent / 365-day test; interest 10 per cent only for a bank's five-year equipment or investment-project loan, otherwise 15; royalties 15 per cent for trademarks and 10 per cent for everything else; fees for technical services a flat 10 per cent. So a payment characterised as a trademark royalty costs 15 while the same payment characterised as a technical-service fee costs 10, and Brazilian 'juros sobre o capital próprio' — economically a return on equity — is fixed by Protocol paragraph 5 as interest (15 per cent, or 10 if the narrow bank condition is met) rather than as a dividend.
Article 22 (other income) is A pure source-taxation article and IT is one sentence long: 'Items of income of a resident of a Contracting State, arising in the other contracting state and not dealt with in the foregoing Articles of this Convention, may be taxed in that other state.' There is no residence-only rule, no PE carve-out and no exception. Read with Art. 13(5) (residual gains taxable in both States) and Art. 12-A (all managerial, technical, consultancy and technical-assistance fees at 10 per cent gross), there is essentially no category of indian-source income of A brazilian resident that escapes indian tax under this treaty. This is a strongly source-oriented instrument, which is characteristic of Brazil's treaty policy and is why the brief describes it as non-OECD in character.
The substituted art. 23 is A credit article with an anti-abuse parenthesis worth noting: credit is given for income which may be taxed in the other State 'except to the extent that these provisions allow taxation by that other state solely because the income is also income derived by A resident of that state'. That parenthesis prevents the Art. 1(2) saving clause from generating a credit obligation. Art. 23(2) adds exemption with progression where income is exempt.
Protocol paragraph 4 is A corresponding-adjustment saving that transfer-pricing practitioners should know about: 'the absence of A clause providing for an obligation of a Contracting State to make an appropriate corresponding adjustment cannot be construed SO as to hinder a Contracting State to make such an appropriate adjustment if IT has been agreed to in the course of A mutual agreement procedure.' Article 9 has no paragraph 2, so there is no treaty obligation to make a corresponding adjustment; the Protocol confirms that the omission is not a prohibition, but relief depends on map. Art. 25(1), as substituted, gives a three-year window from first notification for presenting a map case.
Art. 26 (exchange of information), as substituted, is the modern foreseeably-relevant article with one brazilian limitation that should be flagged: 'The exchange of information is not restricted by Articles 1 and 2, but applies only to federal taxes in the case of brazil.' Brazilian state and municipal taxes are outside the exchange obligation. Note also that use of information for non-tax purposes requires the supplying State's competent authority to authorise it 'expressly ... In writing' — a stricter formulation than the usual 'authorises such use'.
Several transcription defects should be noted before quoting: Art. 12(2) labels both sub-paragraphs '(a)'; Art. 12(3) reads 'the light to use' for 'the right to use'; Art. 2(2)(b) reads 'in federal income tax'; Art. 10(4) reads 'effectivelyconnected'; Art. 11(3)(a) reads 'arising in Contracting State' (missing 'a'); Art. 26(1) reads 'foreseeable relevant' for 'foreseeably relevant'; Protocol para 2 renders 'Contribuigao' for 'Contribuição'; Protocol para 2 cross-refers to sub-paragraph (a) of Art. 2(2) where sub-paragraph (b) is meant; Art. 29 renders 'cedited' and 'termnination'.

What this page does not tell you. Which of the two amending notifications made which change is not established by the sources used here. The text behind each bracketed footnote marker is not available here and the numbering restarts within each article, so the markers cannot be mapped to instruments. The attribution offered in this record — Art. 26 and Protocol para 1 to S.O. 93(E) of 4-1-2018, the beps content to S.O. 1647(E) of 30-3-2026 — is a reasoned inference from the content and the file numbers, not a statement made in the sources used here. The Gazette copies of the two notifications would settle it. The dates of signature of the two amending Protocols and their dates of entry into force are not stated anywhere in the record. Only the Indian notification dates appear. This matters: the effect date of the amendments — and therefore whether Art. 12-A applies to a payment made in FY 2025-26 or only from FY 2026-27 — cannot be determined from the sources used here. Each Protocol will have its own entry-into-force and effect provisions, and neither is reproduced here. The Gazette page/part references for G.S.R. 381(E) of 31-3-1992, S.O. 93(E) of 4-1-2018 and S.O. 1647(E) of 30-3-2026 are not given; only the numbers and dates. Brazil'S MLI position: nothing in the sources used here evidences Brazil as an MLI signatory, and no synthesised text exists. The conclusion that the MLI does not apply rests on that absence. It matters less here than elsewhere because the beps content is in the treaty bilaterally. Art. 26-A(2)(d) requires a non-profit organisation to be 'agreed upon by the competent authorities', and Art. 26-A(3)(a)(iv) requires a bank or financial institution to be 'agreed upon by the competent authorities'; Art. 26-A(6)(a)(ii) allows further recognised stock exchanges to be agreed; and Art. 26-A(7) allows the competent authorities to settle the mode of application of the whole article. Whether any of these agreements has been made is not established from the sources used here. Until they are, limb (d) of the qualified-person test and the financial-institution carve-out in the active-business test are inoperative. Art. 13 was substituted in its entirety with no transitional provision reproduced here. Whether the substituted Article applies to gains realised before the amending Protocol took effect cannot be answered from this record. Art. 5(2)(g) omits 'installation' and omits 'supervisory activities in connection therewith', both of which appear in most Indian construction-PE limbs. Whether that omission is deliberate cannot be established from the sources used here. Protocol paragraph 7 refers to 'the terms museum or other cultural institution' with reference to Article 20, but Article 20 as listed is headed teachers and researchers and the phrase does not appear in the article text as rendered. The cross-reference cannot be reconciled from the sources used here.

The India–Brazil tax treaty