? Introducing Article 13(4): The Real Estate Tax Trap Buster! ??

You’ve heard of tax-saving hacks, but have you met Article 13(4) of the UN Model Tax Convention? ?

It’s the watchdog that stops investors from dodging capital gains tax by selling shares instead of real estate.

? Here’s the loophole it fixes:

Imagine you own a ₹500 Cr property in India. Instead of selling it (and paying tax), you sell shares of your company that owns the property. No direct sale = No tax? ??

Well, Article 13(4) says, "Nice try!" ?✋

? What does it do?

✔ If a company gets more than 50% of its value from real estate, the country where the property is located can tax the capital gains, even if the sale happens through shares, trusts, or partnerships. ??

? Why does it matter?

✅ Protects tax revenues for countries with valuable real estate

✅ Stops indirect tax avoidance through clever structuring

✅ Gives developing countries a fair share of taxes

⚖ Real-world impact?

? India-Singapore DTAA (Before 2017): No tax on indirect real estate sales.

✅ India-Singapore DTAA (After 2017): Tax is imposed on such sales.

? Takeaway?

Selling real estate through shares isn’t a tax-free escape anymore. Countries are closing the gaps with smart tax rules like Article 13(4)! ??