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New Delhi, The government has exempted units of <keyword id="2412922" type="General" weightage="20" keywordseo="investment-trusts" source="Orion">investment trusts</keyword> and <keyword id="46594" type="General" weightage="20" keywordseo="etfs" source="Orion">ETFs</keyword> issued by entities based in <keyword id="6424024" type="General" weightage="20" keywordseo="gift-city" source="Orion">GIFT City</keyword> or traded in exchanges there from capital gains tax. The Central Board of Direct Taxes (CBDT) notified the exemption from capital gains tax any unit of investment trust; a unit of a scheme; and a unit of an Exchange Traded Fund (ETF) launched under the <keyword id="9155869" type="General" weightage="50" keywordseo="international-financial-services-centres-authority" source="Orion">International Financial Services Centres Authority</keyword> (Fund Management) Regulations, 2022. Gujarat International Finance Tec-City (GIFT)-IFSC is being promoted as a tax-neutral enclave for the financial sector. Nangia Andersen LLP Partner-Financial Services Sunil Gidwani said currently, the law provides for exemption from capital gains tax on various securities either trading on the stock exchanges in GIFT city or securities issued by entities set up in GIFT city. "The new fund regime provides for funds to be set up as investment trusts, and hence, the law required the inclusion of units issued by such trusts for the purpose of exemption from capital gains. "Similarly ETF listed and trading on the stock exchanges in GIFT city would now qualify for capital gains tax exemption. These changes would further expand the scope of incentives available for funds and stock market trading in IFSC," Gidwani added AKM Global Tax Partner Amit Maheshwari said the notification is in line with the objective of making the International Financial Services Centre (IFSC) a hub for financial services in the world and incentivising non-resident investors on a recognised stock exchange. "It is important to note that to take advantage of this exemption, the consideration for such a transaction should be paid or payable in foreign currency. The securities, which are added through the new notification, include (i) a unit of <keyword id="2948615" type="General" weightage="50" keywordseo="investment-trust" source="Orion">Investment Trust</keyword>, (ii) a unit of a Scheme, and (iii) a unit of an exchange-traded fund. "These relaxations are a welcome move by the government and will make it globally more competitive for the non-resident investors," Maheshwari added.

Govt exempts investment trusts, ETFs from capital gains tax in GIFT City

The government on Wednesday proposed to hike the <keyword id="9215522" type="General" weightage="20" keywordseo="tcs-rate" source="Orion">TCS rate</keyword> to 20 per cent from 5 per cent currently on overseas tour packages and a liberalized remittance scheme for remittance of funds out of <keyword id="3658" type="General" weightage="20" keywordseo="india" source="Orion">India</keyword>. The Finance Bill, through the Budget 2023-24, amended Section 206C of the Income Tax Act levying a higher Tax Collected at Source (<keyword id="6357150" type="DOMAIN" weightage="20" keywordseo="tcs" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="tcs" meta.entityname="Tata Consultancy Services Ltd." meta.entityid="8345" meta.seoname="tata-consultancy-services-ltd">TCS</keyword>) on overseas tour programme packages. Also, 20 per cent TCS will be applicable in cases where funds in excess of Rs 7 lakh are sent out of India under the Liberalised Remittance Scheme of the RBI. The amendments will come into effect from July 1, 2023. Nangia Andersen India Partner Amit Agrawal said the increase in TCS rate to 20 per cent is a big surprise, especially with the comfortable forex position. "The increase in TCS rates to 20 per cent for <keyword id="148355" type="General" weightage="20" keywordseo="overseas-travel" source="Orion">overseas travel</keyword> perhaps underscores the government's intention to restrict overseas travel spending by HNI's," Agarwal said. Agarwal said the step to increase TCS to 20 per cent for all remittances, other than travel and medical is likely to cause resentment and hardship amongst the middle class and HNIs. "This is especially true since many students aspire for foreign education and the cost of education and living is usually met by parents through LRS, the blanket rate of 20 per cent on all residuary remittances would mean that foreign remittance for education / maintenance is likely to be costlier owing to the 20 per cent TCS," Agrawal said. Deloitte India Partner Neeru Ahuja said TCS on overseas tour packages or liberalized remittance scheme for remittance of funds out of India has been proposed to be increased from 5 per cent to 20 per cent. "Despite the TCS being creditable in the hands of taxpayers, the same shall lead to higher cash outflow at the first instance in the hands of taxpayers," Ahuja said. Tax and consulting firm AKM Global, Tax Partner Amit Maheshwari said, "TCS has been proposed on any foreign payment without any threshold. "This would pose challenges for people intending to go for foreign travel and who wish to invest in overseas stocks as it will increase their immediate outlay," Maheshwari said. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/life-insurance-stocks-fall-up-to-10-after-budget-pushes-for-new-tax-regime/articleshow/97526113.cms">Life insurance stocks fall up to 10% after Budget pushes for new tax regime</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/budget/news/budget-blow-to-hnis-claiming-huge-deductions-for-expensive-houses/articleshow/97525649.cms">Budget blow to HNIs claiming huge deductions for expensive houses</a>

Budget proposes hike in TCS on overseas travel, fund remittances out of India to 20%

New Delhi, May 7 () The government has amended income tax rules as per which Indian authorities would "endeavour" to resolve mutual agreement procedure (MAP) disputes within a timeframe of 24 months, a move aimed at speedy settlement of cases of multinational corporations that have opted the alternative dispute resolution process. The Central Board of Direct Taxes (CBDT) has amended Rule 44G dealing with application and procedure for giving effect to MAP agreement, and also revised Form 34F with respect to making application to the competent authority for invoking MAP. MAP is an alternative dispute resolution process under the tax treaties, under which competent authorities of two countries enter into discussions to resolve tax-related disputes. As many as 600 tax disputes were resolved under MAP between April 1, 2014, and December 31, 2018. "The competent authority in India shall endeavour to arrive at a mutually agreeable resolution of the tax disputes...in accordance with the agreement between India and the other country or specified territory within an average time period of twenty-four months," according to the amended income tax rule. It also states that if a resolution is arrived, the same shall be communicated to the assessee, who shall communicate his acceptance or non-acceptance within 30 days. Upon acceptance of the resolution, the assessee shall withdraw any appeal filed in this regard and pay the tax determined by the assessing officer after giving effect to the resolution. Consulting firm AKM Global Tax Partner Amit Maheshwari said MAP proceedings are increasingly becoming popular with multinational corporations (MNCs) although the time taken to conclude them is an issue and this was recognised in the recently released peer review report. "The competent authority has to now endeavour to complete it in the recommended two-year period for settlement of MAP disputes. Post this amendment, with India not going in for mandatory binding arbitration, MAP will increasingly be used by MNCs to resolve contentious issues," Maheshwari added. Nangia Andersen LLP Director Sudin Sabnis said MAP is aimed at bringing in certainty through an alternative dispute resolution mechanism. "The indicative timeframe of average 24 months to resolve dispute under MAP is a highlight of the new rules which would encourage taxpayers to hope for a speedy dispute resolution mechanism. This is also in line with Action 14 of the BEPS Project prescribing a standard to endeavour to resolve MAP cases in 24 months," Sabnis added. The revised Form 34F seeks to now also include actions of authorities that are not in accordance with the terms of the agreements as well as details of remedy along with documentary evidence. "While India remains embroiled in major international tax and transfer pricing cases, the new rules display the intent of the government to achieve certainty and endeavour to bring faster resolution in place of long-drawn traditional litigation process," Sabnis added. JD HRS

Govt amends I-T rules for faster resolution of multinational corporations' tax disputes under MAP

A glitch in <keyword id="111536" type="UNKNOWN" weightage="20" keywordseo="Online-tax-filing">online tax filing</keyword> system in India may land expatriates in trouble. They won’t be able to file their income tax return online in time as the software is asking for a UID, or <keyword id="144117" type="ORGANIZATION" weightage="20" keywordseo="AADHAAR">Aadhaar</keyword> number. Many expats can’t file their tax returns as the process won’t be complete without an Aadhaar number. Even though the Indian government had notified that the foreign citizens are not required to obtain Aadhaar card for tax filing purpose, they are still facing issues. "In several cases, the income tax e-filing system is not allowing expatriates to upload their returns without Aadhaar as they have been tagged as Indian citizens in the income tax database," Amit Maheshwari, partner at Ashok Maheshwary &amp; Associates LLP, told ET. In some cases, expats are asked to provide their foreign bank account when that's not required as per the law. NRIs, too, "are unable to upload their tax returns when they mention their country of residence", a person told ET. Several representations on the issue have been made to the government in the last couple of weeks. In this backdrop, expats and NRIs want the government to extend the deadline for filing the returns.

This glitch in online tax filing system is leaving expatriates in a fix

Check out winning candidate list from Gujarat Lok Sabha Election 2019

Gujarat Lok Sabha Election Result 2019: BJP makes a clean sweep of all 26 seats

New Delhi, Apr 27 () Experts on Monday termed the RBI's move to open a special liquidity facility of Rs 50,000 crore for the mutual fund sector as "brilliant", saying it will improve investor confidence and reduce stress in the corporate debt market. The Reserve Bank of India's decision comes days after Franklin Templeton Mutual Fund decided to close six debt schemes with assets under management of more than Rs 25,000 crore. With a view to easing liquidity pressures on mutual funds, the RBI decided to open a special liquidity facility of Rs 50,000 crore. At the same time, the RBI highlighted that the stress, however, is confined to the high-risk debt mutual fund (MF) segment at this stage; the larger industry remains liquid. Mutual fund industry body Amfi Chairman Nilesh Shah said it is a good confidence building measure to ensure continued confidence of investors on the industry as also normal functioning of the markets. Nimesh Shah, MD and CEO at ICICI Prudential AMC, said that as a pre-emptive step, the RBI through its announcement of special liquidity facility for mutual funds has aimed to reduce the stress in the corporate bond segment. "...This is a welcome and positive step which will improve investor sentiments. We believe that a deflationary environment where prices come down across asset classes makes debt an interesting asset class to invest in today," he added. Given the incident about winding up of six debt oriented schemes of Franklin Templeton MF, there was much anxiousness and concern among investors, specially retail clients. "Brilliant move by RBI to bring confidence to mutual fund investors and also will help to calm down the corporate debt market," ITI Mutual Fund CEO and CIO George Heber Joseph said. Ankur Maheshwari, CEO, Equirus Wealth, said the RBI's decision will provide comfort to mutual fund investors and preserve financial stability. "Also, while banks had sufficient liquidity already, this is a reassuring step that the regulator is ready to support the markets as and when required," he added. Under the Special Liquidity Facility for Mutual Funds (SLF-MF), the RBI will conduct repo operations of 90 days tenor at the fixed repo rate. The scheme will be available from Monday itself till May 11, 2020, or up to utilisation of the allocated amount, whichever is earlier. The RBI further said funds availed under the SLF-MF should be used by banks exclusively for meeting the liquidity requirements of MFs by extending loans, and undertaking outright purchase of and/or repos against the collateral of investment grade corporate bonds, commercial papers, debentures and certificates of deposit held by MFs. "We would need to understand the definition of investment grade debt instruments. Good quality debt instruments were already getting funding, therefore what all grades of debt instruments are included will determine the actual impact on liquidity into MF system," said Omkeshwar Singh, who is head RankMF at Samco. Kaustubh Belapurkar, Director – Manager Research, Morningstar India said the liquidity window will certainly help improve investor confidence. Mutual funds have ample AAA rated exposures which can be used for this purpose. "But it will be interesting to see, if banks are willing to lend lower down the credit curve if it comes to that. Liquidity is constrained in the debt markets,especially lower down the credit spectrum," he added. He, further, said that debt funds have witnessed redemptions, but most have a significant amount of liquid securities to meet redemptions. This has been in play since March, given the pessimism around the economy slowing down due to the lockdown. Amit Jain, Co-Founder and CEO Ashika Wealth Advisors said liquidity window is a positive sentiment in short term, however in the long run, performance of underlying industry and business model will determine the future liquidity in corporate bond market "Also, we feel, once the lockdown opens we may observe high redemption pressure by Indian corporates from these debt instruments, to fund their day to day operations," he added. The announcement comes days after Franklin Templeton Mutual Fund, which has been operating in India for 25 years, decided to shut down its six schemes citing redemption pressures and lack of liquidity in the bond markets. The Amfi chairman believes that the mutual fund industry continues to be on sound footing both on portfolio quality as also on the liquidity front despite an isolated incident in these challenging times. Barring four fund houses that have collectively taken loan of Rs 4,427.68 crore, as of April 23, 2020, which is a small percentage of the RBI announcement and also overall MF Industry AUMs, none of the other 40 mutual fund houses has any borrowings, thereby indicating sound liquidity, he added. SP MR

RBI MF liquidity window to improve investor confidence, calm down corp debt mkt: Experts

Under its ambitious plan to boost entrepreneurship and job creation in India, the government has removed the so-called '<keyword id="6406536" type="UNKNOWN" weightage="100" keywordseo="Angel-Tax">angel tax</keyword>' for <keyword id="6359051" type="COMPANY" weightage="100" keywordseo="investors">investors</keyword> providing funding to <keyword id="6362513" type="ORGANIZATION" weightage="100" keywordseo="Startups">startups</keyword> 
 Funding to startups, notified under the government-approved plan announced by PM <keyword id="6354477" type="PERSON" weightage="100" keywordseo="Narendra-Modi">Narendra Modi</keyword> in January, will not face tax even if it exceeds the face value. 
 
Under existing rules, funds raised by an unlisted company through equity issuance are covered under this tax to the extent the amount is in excess of the fair market value. 
 
Such extra inflow is taxable as "income from other sources" under Section 56(2) of the Income-Tax Act and charged the corporate tax rate, resulting in an effective tax of over 30%. The venture capital industry has been lobbying for removal of this tax, terming it a big deterrent to investments. 
 In many cases, the valuation of startups is far in excess of market value as it is based on the promise of the idea and not the immediate worth. In such a case, the startup would end up losing a chunk of the inflow to this 'angel tax'. The Central Board of Direct <keyword id="6368033" type="UNKNOWN" weightage="100" keywordseo="Taxes">Taxes</keyword> has issued a notification to this effect, exempting startups raising investments from the rigours of Section 56(2)(viib). 
 
"This has been long awaited and is a very welcome step. The abolition of this so-called 'angel tax' has been a long-standing demand of the industry," said Amit Maheshwari, partner, Ashok Maheshwary &amp;Associates LLP. However, earlier investments can still be questioned by tax officers as being overvalued in the light of declining valuations globally and in India, he said. 
 
Image credit: Indiatimes

In a bid to boost entrepreneurship, Indian government scraps angel tax for investors funding startups

If you are thinking of building the brand of your startup and fretting over taxes, Finance Minister Arun Jaitley may have some good news for you. 
 The Finance Ministry is mulling to give beneficial tax treatment to brand building expenses of the <keyword id="6362513" type="ORGANIZATION" weightage="20" keywordseo="Startups">startups</keyword>. 
 
If everything goes as planned, startups and e-commerce companies will be allowed to have initial brand building expenses with benefits. 
 
"The AMP expenses are very important for e-commerce companies to acquire new customers. A major part of these expenses is intangible and the government should allow identified category of AMP expenses to be capitalised," said KPMG (India) Partner Tax Amarjeet Singh. 
 
Experts say that expenditure in advertisement, marketing and sales promotion (AMP) should be an intangible asset. 
 
Such a move, according to Ashok Maheshwary and Associates Managing Partner Amit Maheshwari, would help reduce the losses and prevent net-worth erosion of the company. 
 
The government has decided to give host of tax incentives to encourage startups and some decisions are likely to be announced by Finance Minister Arun Jaitley in the 2016-17 Budget, to be presented on February 29. 
 
"Further, relaxation of withholding tax compliances by e-commerce companies, which are more in the nature of the startups, would enable them to focus more on the business with the reduced administrative burden resulting from relaxation," Deloitte Haskins &amp; Sells LLP Partner CA Gupta said. 
 
(Image: Thinkstock)

Budget 2016: Here’s why startups should not worry about expenses on brand building

New Delhi, May 13 () Channelising a major chunk of the stimulus package for vulnerable segments like micro, small and medium enterprises (MSMEs) and non-bank lenders will go a long way in protecting jobs and reviving country's economic growth, experts said on Wednesday. Measures like emergency credit line of collateral-free Rs 3 lakh crore from banks and non-banking financial companies (NBFCs) and a Fund of Funds with a corpus of Rs 10,000 crore will help the sector protect jobs and revive country's economic growth which is impacted the lockdown imposed to contain the spread of COVID-19 disease, . Experts also said that reduction of TDS/TCS rates by 25 per cent for non-salary payments to residents will leave more money in the hands of professionals and businesses. Deloitte India Partner, Leader (Government and Public Sector) Arindam Guha said, "Channelising a significant part of the government financing support for vulnerable segments like MSMEs and NBFCs/ housing finance companies (HFCs) in the form of credit or investment guarantees to achieve a multiplier effect and also limit the actual outflow to the extent of default." He said there is a clear focus on structural reforms and ease of doing business as it is evident from the measures around increasing the investment and turnover thresholds for MSMEs to enable them to grow bigger. Guha also lauded steps like advising the state governments and Real Estate Regulatory Authorities to leverage force majeure provisions for providing an additional 6 months to real estate companies and exempting them from the need to obtain a fresh registration certificate or renegotiate contracts with their buyers. Another significant measure was allowing contractors involved in highway/infrastructure construction to avail a standstill period of 6 months without any penalties, he added. JLL CEO and Country Head (India) Ramesh Nair said that the fundamental of any economy is employment generation and the Government of India has made the right interventions by providing the requisite support to MSMEs. The revitalisation of MSMEs will play a major role in the overall revival of the economy, he said adding, this in turn is expected to have a positive impact on the consumer sentiment, which has an important bearing on the real estate sector. "These measures provided to MSMEs will also go a long way in protecting jobs and ensuring income continuity. This in turn will have a positive bearing for potential homebuyers especially in the affordable and mid segments," Nair said. Snapdeal co-founder and CEO Kunal Bahl said these measures will help the MSMEs get back on their feet as additional collateral and guarantee-free loans, equity funding options, better access to government procurement, e-market linkage and higher thresholds are strong enablers. KPMG in India Chairman and CEO Arun Kumar said MSMEs are critical for employment preservation and growth and firing up the MSME sector is the surest way to accelerate job creation. "The finance minister's schemes announced today will provide relief for MSMEs that need immediate succour for their survival as well as help those enterprises that need a fillip to grow. Expanding the definition of MSMEs and introducing new thresholds based on turnover while elevating the investment ceilings for each segment are welcome," Kumar said. The broad focus on enhancing liquidity is timely, including the measures for NBFCs, HFCs and MFIs (micro-finance institutions) and those for the power sector to ease the situation of distribution companies and cash-strapped independent power producers, he said adding that the measures to ease liquidity for lenders and businesses will make a tangible difference. Finance Minister Nirmala Sitharaman on Wednesday announced about Rs 6 lakh crore package comprising Rs 3 lakh crore of collateral-free loans for small businesses and a Rs 30,000 crore lifeline to non-bank and housing finance companies as part of measures to help the economy tide over disruptions caused by the coronavirus lockdown. The minister also announced cut in tax rate on non-salary payments by 25 per cent, support to companies to meet statutory liability on employees' retirement fund, provided a Rs 90,000 crore bailout to cash-starved electricity distribution companies and gave construction firms up to six more months to complete the government projects. Shardul Amarchand Mangaldas &amp; Co Partner Pooja Ramchandani said PF contribution is calculated at 12 per cent of basic wages + dearness allowance + retaining allowance. "The announcement on provident fund reliefs is a positive one. The percentage of PF contribution has been reduced to 10 per cent. Prior to this, the rate of 10 per cent was applicable to establishments with less than 20 employees, sick industries, establishments where losses exceed networth, jute, beedi, brick, coir and gum industries," she said. PwC India Chairman Shyamal Mukherjee said the profound measures to boost liquidity and enable MSMEs to take centre stage in making India self-reliant and play a significant role in the government's vision of Make in India. Nangia Andersen LLP Director Sandeep Jhunjhunwala said the reduction of TDS and TCS rates on non-salaried payments by 25 per cent will set free additional cash in the hands of the vendors and help increase liquidity in the economy. This reduction is estimated to release about Rs 50,000 crore in the hands of people, he said. Consulting firm AKM Global tax Partner Amit Maheshwari said the TDS rate reduction will leave more money in the hands of deductees, especially professionals where the TDS rate is as high as 10 per cent. Kotak Institutional Equities VP and Senior Economist Suvodeep Rakshit said the fiscal measures announced draws strongly upon the aim of providing liquidity and easing the functioning of key sectors. JD MKJ

You Searched For "Amit Maheshwari" and got 11 results

Govt exempts investment trusts, ETFs from capital gains tax in GIFT City

PTI

Budget proposes hike in TCS on overseas travel, fund remittances out of India to 20%

PTI

Govt amends I-T rules for faster resolution of multinational corporations' tax disputes under MAP

PTI

This glitch in online tax filing system is leaving expatriates in a fix

BI India Bureau

Check out winning candidate list from Gujarat Lok Sabha Election 2019

BI India Bureau

Gujarat Lok Sabha Election Result 2019: BJP makes a clean sweep of all 26 seats

RBI MF liquidity window to improve investor confidence, calm down corp debt mkt: Experts

PTI

In a bid to boost entrepreneurship, Indian government scraps angel tax for investors funding startups

BI India Bureau

Budget 2016: Here’s why startups should not worry about expenses on brand building

BI India Bureau

Steps on MSMEs, NBFCs to help protect jobs, revive economy: Experts

PTI

Lok Sabha Election 2019 Candidate List for Gujarat

BI India Bureau

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