It is widely expected that India is, and will continue to be, at the forefront centre of global economic activity for the next several decades.
A high proportion of young population in the demographic mix, availability of skilled workforce across sectors and qualifications, an ever expanding market of ambitious individuals, and constantly improving ease of doing business rankings make India one of the most sought after destination for foreign MNCs to set up operations.
Not only is the Indian consumer ambitious, the Indian business is ambitious too. An increasing large number of Indian businesses, from small to medium to large scale businesses, from family owned traditional brick and mortar businesses to cutting edge technology start-ups, armed with great technology and products, are venturing into overseas markets. We assist Indian businesses with global aspirations with their overseas set-ups.
Our support to foreign businesses Doing Business in India, and to Indian businesses doing business overseas includes:
The global tax landscape has been completely transformed over the past few years. Several holding company structures of the past have now been rendered redundant.
Several tax treaties across the world, including many of India’s tax treaties have been recently renegotiated to prevent ‘treaty shopping’, and to ensure that only companies and other residents with adequate substance are eligible to get access to treaties. Signing of Multilateral Instrument (MLI) relating to tax treaties is also leading to amendment to several tax treaties across the globe.
From an Indian perspective, India has been increasingly streamlining its international taxation laws. Over the past few years, India has also introduced rules to check potentially tax base eroding structures. These include rules relating to Place of Effective Management (POEM), Limitations on Interest Deductions, Equalization Levy, General Anti Avoidance Regulations (GAAR) etc.
Similarly, different countries have pronounced their respective international tax rules. Independently, and through our network of independent firms we work with in different countries, we are able to provide a holistic advice relating to the tax and regulatory aspects of doing business in the foreign country involved.
We assist Indian and foreign businesses planning for their international set-ups, considering Indian and overseas tax and regulatory considerations, ease of doing business, sector specific benefits etc., including advice on:
– Form of entity to be set-up
– Holding company structure
– Capital structure
At this juncture, it also becomes imperative for the taxpayer group to have a well-documented transfer pricing policy, aligned with the transfer pricing requirements of both – the Indian as well as foreign jurisdictions.
In India, the process of setting up any kind of legal entity is much streamlined than it was a few years ago, and is being continuously simplified. The amount of paper-work required for different registrations is being simplified, and many registrations can now be applied for in a single form. Similarly, the process of opening of a bank account is also simpler than before. Having said that, it is pertinent to ensure that the entire set-up process is coordinated efficiently, and any loose ends tied up, to ensure quick start of operations.
It is not difficult to see that any MNC which is setting up in India needs complete hand-holding at the set-up stage. We act as the connecting link between the MNC and the relevant Government or other agencies for setting up the Indian operations including applying for, and obtaining various registrations for doing business in India.
Similarly, for Indian businesses setting up overseas, we provide end to end support (starting from advice and also including implementation and compliance support) with respect to the Indian tax and regulatory implications of their foreign set-ups. Additionally, through our network of independent firms in several key overseas jurisdictions, we also provide assistance with respect to the overseas set up.
In case of inbound investments in India, upon being set-up, the Indian establishment would need to undertake several ongoing tax and regulatory compliances. This includes compliances relating to accounting, payroll, withholding taxes and their payments, filing of various monthly, quarterly and annual returns such as those relating to income taxes and GST, and so on. We assist Indian arms of foreign MNCs with their on-going compliances.
We also assist Indian businesses with foreign set-ups with their tax and regulatory compliances in India. Further, depending on the requirement of the local laws of the foreign country involved, we assist their foreign arms with undertaking / reviewing various compliances under the foreign laws as applicable.
We provide exit-related advice in line with the prevailing tax and regulatory laws in India and the foreign country involved. We also provide assistance in getting the requisite clearances from a tax and regulatory perspective.