• Service: Tax, International Executive Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 4/30/2013

India - Export commissions paid abroad not taxable in India 

April 30: The KPMG member firm in India prepared reports on the following developments (read the April 2013 reports by clicking on the hyperlinks provided below):
  • Export commission paid to foreign agents is not taxable in India: The Mumbai Bench of the Income-tax Appellate Tribunal held that the export commission paid to foreign agents is not taxable in India because the foreign agents did not have any business connection or permanent establishment in India. The tribunal also found that the services provided by the foreign agents were rendered and used outside India and that the payments were also made outside India; therefore, the export commission was not taxable in India.

    The case is: Gujarat Reclaim & Rubber Products Ltd. Read an April 2013 report [PDF 207 KB]

  • Employers required to generate online salary-related form: India’s Central Board of Direct Taxes issued a circular making it mandatory for employers to generate Part A of Form No. 16 from the TDS Reconciliation Analysis and Correction Enabling System (TRACES) Portal, thus allowing for verification before the information is issued to employees.

    Read an April 2013 report [PDF 193 KB]

  • Taxpayer’s income from processing fees, late-payment interest, and loan pre-closure charges relate to the taxpayer’s business of long-term finance and are eligible for deduction: The Karnataka High Court held that processing fees, late-payment interest, pre-closure charges, miscellaneous income, etc, have a direct nexus with the taxpayer’s housing finance business, and that this income is eligible for deduction under section 36(1)(viii) of the Income-tax Act, 1961.

    The case is: Weizmann Homes Ltd. Read an April 2013 report [PDF 207 KB]

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