US-India income tax convention, Article 25: India allows the US tax as a deduction from Indian tax on the same income (Convention between the United States and India (1989), Art. 25(2)(a))
An Indian holder whose licence fee had US tax withheld at the treaty rate can take that tax off its Indian income tax on the same income, up to the Indian tax attributable to that income. The relief comes through the Indian return, not from the IRS.
Dated 18 Oct 2026Source checked 18 Oct 2026Basis: primary text
In the source's own words
“Where a resident of India derives income which, in accordance with the provisions of this Convention, may be taxed in the United States, India shall allow as a deduction from the tax on the income of that resident an amount equal to the income tax paid in the United States, whether directly or by deduction. Such deduction shall not, however, exceed that part of the income tax (as computed before the deduction is given) which is attributable to the income which may be taxed in the United States.”
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