Page 41 - Quick Insights Book 2022

Chap. 8 – International Taxation

globe. Employees are being sent to work in other countries Some of the solutions, which may be provided by Chartered
which increases the tax complications for such employees in Accountants in relation to Cross Border Transactions include:
both the countries. Non-Resident Indians (NRI) are citizens of
India or Persons of Indian origin who become non-residents in  Corporate reorganisations – Suggest suitable investment
India on account of their duration of stay outside India. structure for the Overseas entities especially from Indian
income-tax perspective including recommending suitable
In order to analyze the tax impact of NRIs in India, it would jurisdictions to locate the Overseas holding company for
be relevant to determine the tax provisions both, under the the proposed investments in India and suitable modes
Act as well as the double taxation avoidance agreement. The of investments in the Indian company;
foreign tax credits available to such NRIs shall also have to be
evaluated.  Capital reorganisations – Suggest appropriate alternatives
viz. capital reductions, bonus issues, rights issues,
Some of the solutions, which may be provided by Chartered preferential and debenture and bonds issues, share
Accountants in relation to NRI Taxation, include: buybacks etc., involving non-resident stake holders. This
aspect is relevant from overseas funding perspective as
 Obtaining Tax Registrations – Assist in obtaining the tax well;
identification number (Permanent Ac-count Number) of
the NRI from the income-tax authorities;  Fair Market Valuation of shares and investments
– In case of associated enterprises or deemed to
 Determining Residential Status – Based on the presence be associated enterprises, international or deemed
of the NRI in India, the residential status of such NRI international transactions, there could be a scope for
may be determined under the Act; advisory on the aspects of valuation from Indian transfer
 Property and investment transaction tax advisory – pricing regulations and RBI regulations perspective;
This would include advise to NRIs on acquisition and  Transfer Pricing compliance review including profit
disposal of investments as well immoveable property attribution study in case of cross border transactions
and associated tax compliances, if any; between related parties;
 Issuance of technical opinions on questions of tax law;  Tax due diligence – Conduct a vendor/buyer tax due
 Pre and post NRI status advisory – Advise in relation to diligence which shall involve review of the past records
income tax disclosures pre and post NRI status including of the company in order to find any gaps/observations
disclosures if any, under The Black Money (Undisclosed which may have financial or other impact;
Foreign Income And As-sets) And Imposition Of Tax Act,  Issuance of technical opinions on questions of tax law;
2015;
 Impact study of multilateral instruments i.e. MLI and its
 Preparing and filing Annual Income tax returns and tax effects.
transaction based challans for tax payments, if any –
Prepare computation of income and assist in filing the  Ideation on profit repatriation and exit options –
annual income tax return of the expatriate in India; Assistance in analyzing various possible modes of profit
repatriation and exit of investments from India, based on
 Representation before the revenue authorities including the analysis of the tax laws and treaty provisions;
appellate level and tax tribunal and allied assistance on
litigation management including strategic advisory;  IP/Intangibles Planning – Advising and evaluating
alternatives for the location of the IP/intangibles owned
 Evaluating the applicability of the double taxation by the group in appropriate jurisdiction in order to
avoidance agreement read with the multilateral instrument achieve tax efficiency;
(MLI) with the relevant country, in relation to relevant
streams of income;  Obtaining certificate under section 197 and 281 – Assist
in making an application to the income-tax officer to
 Assistance in claim of foreign tax credits, based on obtain a lower withholding tax certificate under section
relevance; and
197 of the Act or certificate of no tax liability under
 Issuance of remittance certificates under Form 15CA/ section 392 basis the computation of estimated profits
Form 15CB and other compliance certificates if any. or gains including losses if any attributable to the foreign
entity in India;
CROSS-BORDER TRANSACTIONS INCLUDING  Issuance of remittance certificates under Form 15CA/
MERGERS AND ACQUISITIONS Form 15CB and other compliance certificates if any;
Globalization and cross-border transactions has seen an  Representation before the revenue authorities including
upsurge in the number of Mergers and Acquisition transactions. appellate level and tax tribunal and allied assistance on
In the year 2021, India has seen more than 2,000 mergers. litigation management including strategic advisory;

28 Quick Insights on Professional Opportunities for Chartered Accountants