Brooks - A Payroll Specialist, Since 1999

A mid currency crunch, the government is mulling over bringing in an ordinance to amend the payment of wages Act for allowing business and industrial establishments to pay salaries through Cheques or by electronic modes. “The government may bring an ordinance to amend Payment of Wage Act, 1936, to nudge employers of certain industries to make payment through electronic modes and cheques,” a source said Direct foreign investment in India . The source further said, “The bill for the purpose was tabled in the Lok Sabha on December 15, 2016. It can be pushed for passage in the Budget session next year. Thus, instead of waiting for two more months, the government can issue the ordinance and later it will be passed in Parliament.” Standard practice is, government brings ordinance to amend laws for immediate implementation of new rules. An ordinance is valid for six months only. Government is required to get it passed in Parliament within that period in accounting out...

The government is likely to expand the scope of the equalisation levy, the so-called “Google tax”, to bring more digital transactions into the tax net in the upcoming budget to curb tax avoidance by multinational chartered accountant firms in mumbai . Online sales of goods and services; downloading of software, songs, movies and books; and online consumption of news are among the services that the government may consider for the levy. “Internationally the trend is to bring more digital transactions into the tax net as multinational companies end up avoiding taxes. It was just a beginning last year when we introduced a six per cent tax on online advertisement,” said an official. The government has imposed a six per cent levy for business-to-business transactions on income accruing to foreign e-commerce companies from India for specified services like online advertisement. It has been imposed on non-resident companies without a permanent establishment for incomes...

The government signed a pact with its Singapore counterpart on 30th Dec, 2016, amending their decade-old tax treaty, gaining indirect taxation in India rights over capital gains. This is the third double taxation avoidance agreement (DTAA) amended so far this financial year with a zero or low tax jurisdiction. The other two were with Mauritius and Cyprus. According to tax consultants in India , Mauritius would be the most attractive source of investments into India for debt funds and Singapore for equity investments. Mirroring the revised IndiaMauritius DTAA, the government has some grandfathering provisions (having the old rule continuing to apply for some existing situations, with the new one for all future cases) and a two-year transition benefit to investments from Singapore. The revised pact will take effect from April 1, 2017. For two years from that date, capital gains tax will be imposed at 50 per cent of the prevailing domestic rate. The short-term rat...

Where assessee-company made payment of royalty to its AE for mere use of trademark, that too by means of non-exclusive licence, it was to be allowed as revenue expenditure while determining ALP. Assessee-company (GKN Driveline (India) Ltd.) was engaged in business of manufacture and sale of Constant Velocity Joints (CVJ) – During relevant year, assessee made payment of royalty to AE for use of its trademark in respect of manufactured products – In transfer pricing proceedings, TPO taking a view that payment in question was capital in nature, disallowed same and made certain addition to assessee’s ALP – It was noted that Tribunal in assessee’s own case relating to earlier assessment year, opined that assessee did not acquire any ownership right in trademarks by paying amount of royalty – It was further noticed that royalty was paid simply for use of trademarks, and that too tax consultancy firms in delhi , by means of a non-exclusive license – Tribunal had thus conclude...

As announced in the Union Budget 2016-17, it has now been decided to expand the investment basket of eligible instruments for investment by FPIs under the corporate bond route to include the following: (i) Unlisted corporate debt securities in the form of non-convertible debentures/bonds issued by public or private companies subject to minimum residual maturity of three years and end use-restriction on direct foreign investment in india  real estate business, capital market and purchase of land. The expression ‘Real Estate Business’ shall have the same meaning as assigned to it in Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000 Notification No.FEMA.362/2016-RB dated February 15, 2016. The custodian banks of FPIs shall ensure compliance with this condition. Read more information visit at:  http://bit.ly/2jToKZX

Liberalization of Foreign Direct Investment - Other Financial Services Department of Industrial Policy & Promotion in order to provide easy finance to the Indian Industries has liberalized the Foreign Direct Investment ('FDI') limits in Non-Banking Financial Company. Para 5.2.26 of the Consolidated FDI Policy has been replaced with the following para subject to specified conditions chartered accountants firms in mumbai : Before Circular: Foreign investment in NBFC is allowed under the automatic route in only the following activities:       i.        Merchant Banking      ii.        Under Writing      iii.       Portfolio Management Services     iv.    ...