Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: articles on VAT and GST in India :: ACCOUNTING STANDARDS :: cpt :: VAT Audit :: VAT RATES :: TAX RATES - GOODS TAXABLE @ 4% :: form 3cd :: Central Excise rule to resale the machines to a new company :: empanelment :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: list of goods taxed at 4% :: ACCOUNTING STANDARD :: TDS :: due date for vat payment :: ARTICLES ON INPUT TAX CREDIT IN VAT
 
 
Direct Tax »
 Income tax return: TDS refund on capital gains invested needs to be instant
 CBDT holds circular on indirect tax provisions
 CBDT puts on hold circular on taxation of indirect transfer of shares
 CBDT prods officials to meet tax collection targets
 Budget 2017: Direct tax reforms to be gradual than radical, says KPMG
  FM Arun Jaitley may drop tough tax accounting rules
 FM Arun Jaitley may drop tough tax accounting rules
 How to view your TDS through form 26AS?
 Deduction of tax at source Income-tax deduction from salaries under section 192 of the Income-tax Act, 1961
 Banks must furnish information on accounts that have seen deposits over 2.5 lakh: CBDT
 Govt expects direct and indirect tax targets to exceed budget estimates this fiscal

Indian IT companies will continue to get tax benefits: Finance Ministry
January, 18th 2013

The finance ministry has said software development at client locations and deployment of personnel abroad by India's IT firms such as InfosysBSE -0.18 %, WiproBSE -5.06 %, and TCSBSE -0.37 % will continue to get tax exemptions, drawing cheer from the $100 billion sector.

The Central Board of Direct Taxes on Thursday said 'onsite' work at client locations by software firms would be treated as deemed exports, making them eligible for tax benefits. It also said deployment of manpower abroad and transfer of a software unit from one special economic zone to another would not impact these concessions.

"We hope that these clarifications will set the disputes to rest," CBDT chairperson Poonam Kishore Saxena told reporters.

The clarifications are based on the recommendations of a panel headed by former CBDT Chairman N Rangachary, set up by Prime Minister Manmohan Singh following representations from industry.

The clarifications address key concerns of the software sector over the stability of tax exemptions enjoyed by them under various schemes, after tax authorities started issuing notices and raising tax demands.

The industry was quick to cheer the announcement, but said past assessments and denials of benefits should be resolved in line with the latest clarifications.

"While this is a positive step, it is important that the implementation is carried on efficiently. We urge that benefits denied in the past be reviewed in light of this move, and there be swift closure of cases for the Industry to benefit from this," Nasscom President Som Mittal said in a statement.

Nasscom represents the $100 billion Indian IT-ITeS industry, which earns almost $79 billion from exports. India accounts for less than 5% of global technology spending.

"These clarifications largely address most of industry's concerns," said Pranav Satya, partner, Ernst & Young.

The clarifications issued by the Central Board of Direct Taxes come days before Finance Minister P Chidambaram embarks on a visit to Hong Kong and Singapore to woo investors.

Software companies enjoy tax exemptions under special economic zone scheme and software technology park scheme, but disputes arose between the industry and the tax department after exemptions available on export of software services were denied on various grounds.

Different interpretations of existing laws gave rise to disputes and litigation.

"It is clarified that the software developed abroad at a client's place would be eligible for benefits under the respective provisions, because these would amount to 'deemed export' and tax benefits would not be denied merely on this ground," the Central Board of Direct Taxes said in a statement.

But the CBDT said a "direct and intimate" connection would be necessary between development of software abroad and the units to be eligible for tax benefit. Also, the development of software would have to follow a contract between clients and the eligible unit.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Wholesale Silver Jewelry

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions