New Delhi (PTI): India and Tajikistan on Thursday signed a Double Taxation Avoidance Agreement (DTAA) to promote flow of investment, technology and services.

"(In case of India) the Agreement will cover... income tax, including any surcharge thereon, and in case of Tajikistan, the taxes on income of legal persons and on income of individuals," a government release said.

Pensions and other similar remuneration will be taxable only in the state of residence, it added.

As per the agreement, the profits derived by an enterprise from the operations of ships or aircraft in international traffic shall be taxable in the country of enterprise, the release said.

Visiting students have been provided tax concessions for such period of time as may be reasonable or customarily required to complete the education or for six consecutive years from the date of their arrival.

Double taxation will be eliminated through the credit method - tax paid by a resident of India in Tajikistan will be allowed as a credit if the same income is taxable in India and the vice versa.

The Agreement also provides for exchange of information between tax authorities of the two countries for carrying out the provisions of the Agreement or of the domestic laws concerning taxes covered by the Agreement.

There is also an anti-abuse provision aimed at preventing misuse of the Agreement.