Direct Tax
Domestic taxation
Tax audit is a compulsory audit under section 44AB of the Income-tax Act in India which is conducted where gross turnover exceeds Rs. 1 crore/ 25 lakh from business/profession.
Services
- Conducting of tax audit
- Filing of tax audit report in form 3CA/3CB and 3CD
Tax management/compliance is at the core of today’s business obligations that include filings and payment of taxes.
Services
- Filing of income tax returns
- Filing of TDS/TCS returns
- Compliances related to advance tax
Scrutiny Assessment U/S 143(3)
Scrutiny assessment refers to the examination of a return of income by giving an opportunity to the assessee to substantiate the income declared and the expenses, deductions, losses, exemptions, etc. claimed in the return with the help of evidence.
Purpose
In the cases selected for scrutiny, the assessing officer conducts necessary enquiries during assessment proceedings to ensure that the assessee has not:
- Understated the income, or
- Computed excessive loss, or
- Underpaid tax in any manner.
Rectification U/s Section 154
Rectification of mistake apparent in intimation, assessment, revision and appellate orders.
Appeals U/s 246A [i.e. CIT(A)] and 253 [i.e. ITAT]
An appeal is applying to a higher authority for a reversal of the decision of an assessing officer/lower authority.
Revision U/s 263 & 264
Revision U/s 263 is the reversal of erroneous and prejudicial order of subordinates by CIT/Pr. CIT. Revision U/s 264 is an alternative option available to the assessee. Instead of going to appeal, he can approach CIT/ Pr. CIT.
Services
- Representation before the tax department with respect to assessments, investigation, survey, search and other civil cases
- Representation before CIT(A) and ITAT
- Representation before the Authority for Advance Ruling with respect to residents
- Filing of replies to summons and other notices
- Filing of compounding applications to CCIT
Specified transactions between related parties are applicable for domestic transfer pricing regulations and compliance.
Services
A report under Section 92E in Form 3CEB needs to be filed for all the specified domestic transactions whose individual transaction amount exceeds 5/20 crores during the year under review.
Due diligence with regard to tax includes a review of all taxes, the company is required to pay and ensuring their proper calculation with no intention of under-reporting of taxes. Additionally, verify the status of any tax-related case pending with the tax authorities.
Services
Documentation of tax compliance and potential issues typically includes verification and review of the following:
- Copies of all tax returns – including income tax and withholding taxes
- Information relating to any past or present pending tax assessments against the company
In today’s business world, every transaction/arrangement is subject to income tax. So, to avoid surprise tax burden, tax advice needs to be sought before entering into any sort of transaction/arrangement.
Services
- Transaction/Arrangement structuring to avoid/lessen tax burden within the purview of tax laws
- Providing opinions on domestic taxation Issues i.e. interpreting of provisions, etc.
International Taxation
Q. What is transfer pricing?
Transfer pricing refers to the setting, analysis, documentation, and adjustment of charges made between related parties for goods, services, or use of property (including intangible property).
Q. Is it mandatory?
Yes, as per the Section 92 to 92F of the Income-tax Act 1961.
The Finance Act, 2001 substituted Section 92 of the Income-tax Act, 1961 by new sections 92 and 92A to 92F. These new provisions require commercial outcomes arising from international transactions between associated enterprises to be consistent with the arm’s length principle.
The calculation of arm’s length price has to be done by using the most appropriate method. The Income-tax Act mandates the company that ALP is to be calculated using one of the following methods:
- Comparable Uncontrolled Price method (“CUP”);
- Resale Price Method (“RPM”);
- Cost Plus Method (“CPLM”);
- Profit Split Method (“PSM”);
- Transactional Net Margin Method (“TNMM”)
Q. What we provide?
We provide full strength professional services on activities relating to transfer pricing as according to ALP pronounced by the prescribed authorities in this respect. We assist you in the following aspects of transfer pricing:
- Planning, review and evaluation of transfer pricing mechanism.
- Adherences and compliance of transfer pricing regulations and provisions as according with present legislations.
- Representation before the competent authorities.
- Expert tax planning with a flexible approach on implementation of methodologies of transfer pricing.
- Consultancy services on potential threats interrelated with the existing legislation and the policies of the organization to avoid taxation and legal consequences.
Deliverables
Documentation:
The required documentation is as prescribed by the Rule 10D of the Income-tax Act 1961.
The document emphasizes on the analysis of the following aspects:
- Functional analysis
- Asset analysis and
- Risk analysis
Certification
As per the Income-tax Act companies who are required to file TP reports has to file FORM 3CEB to the tax department duly certified by a chartered accountant before the due date of filing income tax.
Penalties for non-compliance
Compliance Section | Contravention | Penalty |
sub-section (1) or sub-section (2) of section 92D | failure to keep and maintain information and document in respect of international transaction | sum equal to two per cent of the value of each international transaction entered into by such person |
sub-section (3) of section 92D | Penalty for failure to furnish information or document under section 92D. | Sum equal to two per cent of the value of the international transaction for each such failure. |
section 92E | Penalty for failure to furnish report under section 92E. | Sum of one hundred thousand rupees. |
Transfer pricing assessment U/s 92CA
During TP assessment, the transfer pricing officer assess arm’s length price of international transactions and any other discrepancies.
Advance Ruling U/s 245O
Advance ruling means:
- a determination by the authority in relation to a transaction which has been undertaken or is proposed to be undertaken by a non-resident applicant; or
- a determination by the authority in relation to the tax liability of a non-resident arising out of a transaction which has been undertaken or is proposed to be undertaken by a resident applicant with such non-resident; or
- a determination by the authority in relation to the tax liability of a resident applicant, arising out of a transaction which has been undertaken or is proposed to be undertaken by such applicant; and such determination shall include the determination of any question of law or of fact specified in the application;
- a determination or decision by the authority in respect of an issue relating to computation of total income which is pending before any income-tax authority or the Appellate Tribunal and such determination or decision shall include the determination or decision of any question of law or of fact relating to such computation of total income specified in the application;
- a determination or decision by the authority whether an arrangement, which is proposed to be undertaken by any person being a resident or a non-resident, is an impermissible avoidance arrangement as referred to in Chapter X-A or not:
Services
- Representation before income tax authorities with respect to assessment, investigation etc.
- Representation before Appellate Authorities
- Representation before Dispute Resolution Panel
- Assist in preparation and filing applications seeking an advance ruling with the Authority for Advance Rulings
- Representation before Authority for Advance Ruling
Tax compliance with respect to international transactions and MNCs has increased due to BEPS initiatives.
Services
- Filing of Form 3CEB
- Filing of master file and CbC Report
- Filing of Form 15CA and Form 15CB
- Filing of flipside returns
When multinationals look at business opportunities beyond the boundaries of their countries, they are faced with the crucial step of structuring. This is where professionals like us can offer our expertise and guide the corporates in putting together a structure, which is tax-optimum and legally compliant.
Inbound Investments
- Advising on entry strategies and evolving optimal ownership/jurisdiction structures for investment in India.
- Advising on entity structuring for selecting an optimal entry vehicle such as a branch, subsidiary, joint venture, to name a few.
- Assistance in filing/obtaining necessary regulatory approvals including those from the Reserve Bank of India, the Foreign Investment Promotion Board, Government of India and other Regulatory Authorities.
- Incorporation/registration of entry vehicle.
- Advisory/compliances associated with other mode of inbound investments such as foreign institutional investors, venture capital funds, etc.
Outbound investments
- Advising on cross border investment strategies and evolving optimal ownership/jurisdiction structures for investment into a particular jurisdiction which include setting up an international holding company, global sales company, etc.
- Advising and assistance on entity structuring, capital structuring and regulatory approval process in selected jurisdiction.
- Assistance in finalizing/review of shareholders, joint venture and other relevant business agreements.
- Striving to enhance tax credit and income deferral in India, mergers, acquisitions and due diligences.
Services for FIIs
- A foreign financial institution which intends to invest in the securities of Indian Companies through the Indian stock market is required to register in India with the Securities and Exchange Board of India (SEBI) as a Foreign Institutional Investor (FII).
- We assist clients in identifying the international tax issues impacting the investment structure and on-going investment transactions.
International transactions/arrangements are more prone to litigation due to differences in DTAA and domestic law. So, to avoid litigation and over tax burden later, tax advice needs to be sought before entering into any sort of transaction/arrangement
Services
- Providing opinions with respect to DTAA and Domestic Law