• Service: Tax, Global Mobility Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 8/5/2014

India - Payments for website access, royalties under UK treaty 

August 5: The KPMG member firm in India has prepared the following reports (click on the hyperlinks below to read more).
  • Bombay High Court warns tax authorities that costs can be imposed for raising repeated appeals on settled issues - The Bombay High Court reiterated that with respect to calculating the total income of an insurance company, the income falling under Chapter III (income not forming part of total income) is to be excluded, and cautioned the tax authorities that costs could be imposed (with such costs to be borne by the revenue officers) for raising repetitive issues that have been already settled by the court.

    The case is: Kotak Mahindra Old Mutual Life Insurance Ltd. Read a July 2014 report [PDF 441 KB]

  • Payments to use licensed software, system to access information on the foreign company’s portal constitutes royalty under the India-UK tax treaty - The Mumbai Bench of the Income-tax Appellate Tribunal held that the use of software and a computer system, to have access to a website portal of a foreign company, amounts to the imparting of information concerning technical, industrial, commercial or scientific equipment. Accordingly, payments made by Indian subscribers to the foreign taxpayer are for the use of, or right to use, equipment and information for processing requests for the purchase and sale of foreign exchange and are taxable as royalty under the India-United Kingdom income tax treaty.

    The case is: Reuters Transaction Services Ltd. Read an August 2014 report [PDF 445 KB]

  • Tax audit report requirements - India’s Central Board of Direct Taxes amended Appendix II (Forms No. 3CA, No. 3CB and No. 3CD) of the Income-tax Rules, 1962.

    Read an August 2014 report [PDF 220 KB]

  • Clarification on the tax treatment of alternative investment funds - India’s Central Board of Direct Taxes issued a circular intended to provide clarity on the taxation of alternative investment funds that are registered with the Securities and Exchange Board of India under the Securities and Exchange Board of India (Alternative Investment Funds) Regulations.

    Read an August 2014 report [PDF 424 KB]

  • Amendment is “curative” and therefore applies retrospectively, despite legislative intent of prospective application - The Karnataka High Court in several cases held that an amendment made by the Finance Act, 2010 applies on a retroactive (retrospective) basis. The amendment was found to be “curative,” and therefore, it is to be applied retroactively, notwithstanding that the Parliament stated that it is effective 1 April 2010.

    Read an August 2014 report [PDF 451 KB]

  • Social Security Agreements with Finland, Sweden - India’s Social Security Agreements with Finland and with Sweden are effective from 1 August 2014.

    Read an August 2014 report [PDF 438 KB]

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