The document discusses key amendments proposed by the Finance Bill of 2012 relating to transfer pricing provisions in India. Some of the key points covered are:
1. It proposes to insert new sections to provide a framework for Advance Pricing Agreements (APAs) between taxpayers and tax authorities to determine appropriate transfer pricing methodology for transactions over a fixed period.
2. It empowers the tax authority to examine international transactions not reported by the taxpayer, even if not referred by the assessing officer.
3. It extends applicability of transfer pricing regulations to certain domestic transactions between related parties.
4. It discusses provisions related to determination of arm's length prices and application of the most appropriate transfer pricing method.
The document discusses secondary adjustments in transfer pricing under Indian tax law. It defines secondary adjustment as an adjustment in the books of accounts of the taxpayer and its associated enterprise to align profits with the arm's length price determined during primary adjustment. Section 92CE of the Income Tax Act was introduced to provide statutory validity to secondary adjustments where primary adjustments meet certain criteria. It summarizes the key provisions and implications of section 92CE, including that excess funds from primary adjustment not repatriated within a prescribed time will be deemed an interest-bearing advance.
Form of Heads of Agreement of Consortium (Purchase this doc, Text: 0811888727...GLC
1. The document outlines the key terms of a proposed transaction for an investor to acquire a 90% stake in the ABC Group, a group of coal mining companies in Indonesia.
2. The investor will conduct due diligence on the legal, financial, and technical aspects of ABC Group over 3 months and negotiate a Conditional Sale and Purchase Agreement within 1 month of completing due diligence.
3. The transaction price will be based on the verified mineable coal reserves determined during due diligence, within a price range of $X to $Y per ton of reserves.
This document provides instructions for completing a Housing Assistance Payments Contract (HAP contract) used to provide Section 8 tenant-based housing assistance. It explains that the HAP contract has three parts: Part A includes contract information to be filled out; Part B is the body of the contract; and Part C is a tenancy addendum. It provides guidance for filling out Part A, including entering information about the tenant, contract unit, household members, initial lease term, initial rent to owner, and utilities and appliances responsibility. The HAP contract is required for use by the U.S. Department of Housing and Urban Development (HUD) to provide Section 8 assistance.
This document provides information about the Polaris Governmentwide Acquisition Contract (GWAC) Small Business (SB) Pool request for proposal. It establishes the GWAC as an indefinite-delivery, indefinite-quantity contract to provide customized IT services and IT services-based solutions to federal agencies. The document outlines the scope of services, describes how the contract will be administered, establishes labor categories and pricing guidelines, and provides other program details.
AMENDMENTS TO SARFAESI ACT/RULES/DRT ACT AND RULES WHICH HAVE BEEN ENFORCEDMukesh Chand
The document summarizes key amendments to the Security Interest (Enforcement) Rules, 2002 and the Debt Recovery Tribunal (Procedure) Rules, 1993 in India that came into effect from November 4, 2016. Some of the major changes include:
1) Allowing delivery of notices by hand delivery in addition to other modes.
2) Reducing the notice period for subsequent auctions of secured assets from 30 days to 15 days.
3) Allowing service of notices via email in addition to other modes.
4) Providing for public auctions, including e-auctions of secured assets.
5) Reducing timelines for filing written statements and replies in DRT recovery applications.
Here we are with the Thirty fifth successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
The Finance Bill of 2012 extends transfer pricing regulations to domestic transactions between related parties. This subjects taxpayers claiming tax incentives like SEZ benefits or deductions under sections 80IA/IB/IC to recomputation of income based on fair market value of related party transactions over Rs. 5 crore. While this aims to bring objectivity to related party transactions, it significantly increases compliance burden. The changes take effect from April 2013 and apply to AY 2013-14 onwards, impacting many industries with tax benefits or intra-group transactions.
Arm’s length price (“ALP”) is nothing but a benchmark or a standard price meant for comparison with price charged or paid by assessee in international transactions with its associated enterprises. Since this standard price constitutes basis for making addition in hands of assessee on account of its international transactions with associated enterprises, legislature, in order to iron out creases, inserted proviso to section 92C(2); role of this proviso is to make such standard price or ALP, flexible and not rigid. It has been provided that if price actually charged or paid by assessee falls within plus/minus 5% range of such ALP or standard price, then no addition should be made.
The document discusses secondary adjustments in transfer pricing under Indian tax law. It defines secondary adjustment as an adjustment in the books of accounts of the taxpayer and its associated enterprise to align profits with the arm's length price determined during primary adjustment. Section 92CE of the Income Tax Act was introduced to provide statutory validity to secondary adjustments where primary adjustments meet certain criteria. It summarizes the key provisions and implications of section 92CE, including that excess funds from primary adjustment not repatriated within a prescribed time will be deemed an interest-bearing advance.
Form of Heads of Agreement of Consortium (Purchase this doc, Text: 0811888727...GLC
1. The document outlines the key terms of a proposed transaction for an investor to acquire a 90% stake in the ABC Group, a group of coal mining companies in Indonesia.
2. The investor will conduct due diligence on the legal, financial, and technical aspects of ABC Group over 3 months and negotiate a Conditional Sale and Purchase Agreement within 1 month of completing due diligence.
3. The transaction price will be based on the verified mineable coal reserves determined during due diligence, within a price range of $X to $Y per ton of reserves.
This document provides instructions for completing a Housing Assistance Payments Contract (HAP contract) used to provide Section 8 tenant-based housing assistance. It explains that the HAP contract has three parts: Part A includes contract information to be filled out; Part B is the body of the contract; and Part C is a tenancy addendum. It provides guidance for filling out Part A, including entering information about the tenant, contract unit, household members, initial lease term, initial rent to owner, and utilities and appliances responsibility. The HAP contract is required for use by the U.S. Department of Housing and Urban Development (HUD) to provide Section 8 assistance.
This document provides information about the Polaris Governmentwide Acquisition Contract (GWAC) Small Business (SB) Pool request for proposal. It establishes the GWAC as an indefinite-delivery, indefinite-quantity contract to provide customized IT services and IT services-based solutions to federal agencies. The document outlines the scope of services, describes how the contract will be administered, establishes labor categories and pricing guidelines, and provides other program details.
AMENDMENTS TO SARFAESI ACT/RULES/DRT ACT AND RULES WHICH HAVE BEEN ENFORCEDMukesh Chand
The document summarizes key amendments to the Security Interest (Enforcement) Rules, 2002 and the Debt Recovery Tribunal (Procedure) Rules, 1993 in India that came into effect from November 4, 2016. Some of the major changes include:
1) Allowing delivery of notices by hand delivery in addition to other modes.
2) Reducing the notice period for subsequent auctions of secured assets from 30 days to 15 days.
3) Allowing service of notices via email in addition to other modes.
4) Providing for public auctions, including e-auctions of secured assets.
5) Reducing timelines for filing written statements and replies in DRT recovery applications.
Here we are with the Thirty fifth successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
The Finance Bill of 2012 extends transfer pricing regulations to domestic transactions between related parties. This subjects taxpayers claiming tax incentives like SEZ benefits or deductions under sections 80IA/IB/IC to recomputation of income based on fair market value of related party transactions over Rs. 5 crore. While this aims to bring objectivity to related party transactions, it significantly increases compliance burden. The changes take effect from April 2013 and apply to AY 2013-14 onwards, impacting many industries with tax benefits or intra-group transactions.
Arm’s length price (“ALP”) is nothing but a benchmark or a standard price meant for comparison with price charged or paid by assessee in international transactions with its associated enterprises. Since this standard price constitutes basis for making addition in hands of assessee on account of its international transactions with associated enterprises, legislature, in order to iron out creases, inserted proviso to section 92C(2); role of this proviso is to make such standard price or ALP, flexible and not rigid. It has been provided that if price actually charged or paid by assessee falls within plus/minus 5% range of such ALP or standard price, then no addition should be made.
Rodel S. Navarro; Business and Management Consultant and Director; RODEL SY NAVARRO BUSINESS CONSULTANCY SERVICES (RSNBCS); Tel / Mobile: +63-0917-7333563; Email: rsnbcs@gmail.com http://www.slideshare.net/RSNBCS; (About Business Laws compilation): http://www.slideshare.net/BUSINESSLAWSPH Email: businesslawsph@gmail.com; https://www.slideshare.net/FREEPDFBOOKSPH; freepdfbooksph@gmail.com; www.slideshare.net/IFRS_IAS_COMPILED; ifrs.ias.compiled@gmail.com; https://www.slideshare.net/PH_STANDARDSONAUDITING_COMPILED; psauditing.compiled@gmail.com
Annual Procurement Planning Rule II - Procurement Planning.pdfMariaMicaEllaYT
The document discusses procurement planning and budgeting. It states that all procurement must be included in the Annual Procurement Plan (APP) and must be consistent with the approved budget. The APP is formulated based on Project Procurement Management Plans from implementing units and must be approved by the head of the procuring entity or their designee. The APP can be revised every six months and changes must be submitted to the Government Procurement Policy Board. Procurement can only be undertaken in accordance with the approved APP.
Key Direct Tax proposals announced by the Finance Minister on February 1, 2017.
CONTENTS on INCOME-TAX
1. Transfer Pricing
2. Non-resident
3. Corporates
4. Capital Gains
5. Assessments
6. Effect of Demonetisation
7. Other Amendments
8. Rates of Tax
This document outlines International Standard on Auditing 210 which deals with an auditor's responsibilities in agreeing the terms of an audit engagement. Some key points:
- The auditor must confirm that the preconditions for an audit are present, including determining if the applicable financial reporting framework is acceptable and obtaining management's acknowledgement of its responsibilities.
- The agreed terms of the audit engagement must be documented in writing, such as an engagement letter, and include items like the objective and scope of the audit.
- For recurring audits, the auditor assesses if the terms need revising or reminding. Any changes to terms require agreement and documentation.
- Additional considerations include whether the financial reporting framework is supplemented by law/
1) Advance Pricing Agreements (APAs) allow taxpayers to determine transfer pricing methods and arm's length prices for future international transactions in a cooperative manner to avoid potential disputes.
2) Taxpayers can apply unilaterally, bilaterally, or multilaterally for APAs. Bilateral and multilateral APAs require coordination between Indian and foreign tax authorities.
3) Extensive documentation must be provided including financials, functional analyses, critical assumptions, and proposed transfer pricing methodology.
This document provides an overview of IFRS 15, the International Financial Reporting Standard on revenue from contracts with customers. Some key points:
- IFRS 15 establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.
- The core principle is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled.
- IFRS 15 specifies the accounting for individual contracts and provides a practical expedient to apply the guidance to portfolios with similar characteristics. It applies to all contracts with customers except those in the scope
Developers have several potential next steps in response to the UK government's proposal to introduce contracts for difference (CfDs) for solar plants over 5MW starting April 1, 2015. These include: 1) Setting up framework agreements with main equipment suppliers; 2) Mechanizing the CfD application process for project pipelines of 50-200MW; and 3) Organizing "shovel ready" development packs with all rights and approvals in place. Developers may also look to aggregate resources with funders, manufacturers, and O&M providers to form larger solar companies that can more easily obtain CfDs and financing. The government aims to limit spending on solar and may take time to approve very large CfD applications
Due to the rapid spread of the novel coronavirus disease (COVID-19), India was forced to suspend most of its economic activities, considerably impacted the economy. Given that, suspension of economic activities may trigger debt defaults, the Government attempted to provide various reliefs to business.
Contract management , GFR Rules, Sampling and Testing.pptxsumitmmmecce
The document discusses rules 224-226 of the General Financial Rules of 2017 regarding contract management which specify that all contracts must be made by an authorized authority, general principles for contracts such as using standard forms and legal advice, and measures for enforcing general contract conditions such as approving technical representatives and sample materials. It also provides details on contract documents, price variation clauses, and other contractual terms.
The Government has enacted the CGST (Amendment) Act, 2018, the IGST (Amendment) Act, 2018, by publication in official Gazette to amend the respective GST Acts.
In this regard, we have captured major amendments in CGST Act, 2017 and IGST Act, 2017 for your perusal
The document discusses the proposed Results Management Framework for 2010-2012 and provides an overview of the revised General Conditions for IFAD financing agreements. Key changes include making the financing agreement shorter by moving standard provisions to the General Conditions, and removing the requirement for expenditures to be incurred in an IFAD member state. The General Conditions define terms like eligible expenditures and set rules around loan accounts, withdrawals, currency provisions, and project implementation through annual workplans and budgets.
Amendment to Finance Bill, 2017- Section 92CEDharmesh Shah
- Section 92CE was introduced to make transfer pricing adjustments mandatory in the books of account of the taxpayer and associated enterprise (AE) to reflect the consistent allocation of profits between them.
- Primary adjustments refer to adjustments that increase or decrease income/loss to align with arm's length pricing. Secondary adjustments require aligning the books of both parties with the primary adjustment.
- If excess funds are not repatriated to India by the AE, it will be deemed an advance from the taxpayer to the AE, on which interest must be computed. This could lead to further transfer pricing adjustments.
- Secondary adjustments in the AE's books may be difficult to implement practically, as the taxpayer and tax authorities have no control
The document discusses the accounting treatment for warranty provisions under construction contracts and revenue recognition by a public sector company. It notes the company's previous and current policies for warranty provisions and revenue recognition. The current policy recognizes warranty provisions progressively based on revenue recognized, while the previous policy deferred revenue recognition until trial completion. The querist seeks opinion on whether the current policy complies with accounting standards. The expert committee considers AS 7 and 29 and concludes that a warranty provision should be recognized when contractual obligations exist. As the company can reliably estimate warranty costs and follows the percentage of completion method, warranty costs should be recognized based on contract completion progress, in line with the company's current policy.
Dear Professional Colleagues,
Sharing with you "Budget Updates-2019". A brief analysis of:
1. Transfer Pricing Amendments
2. Individual Taxation-Tax Incentives
3. Tax Rates
Hope you will find it useful and informative too.
Regards
CA. Reetika G Agarwal
The document discusses the procedure and essential elements involved in preparing a final account. It defines key terms like final account, provisional sums, and prime cost sums. The procedure for final account involves the contractor submitting documents within 6 months of completion for the architect to complete the account within another 6 months. Adjustments must be made for variations, remeasuring provisional quantities, omitting unused provisional/prime cost sums, and adding back nominated subcontractors' accounts. Implications of omitting works from the bill of quantities and not allowing them as provisional sums are discussed from the client and contractor perspectives.
The document discusses changes to accounting standards for mergers and acquisitions (M&A) under FAS141R that will take effect in 2009. Key changes include stricter timing for reporting deals, requiring contingent consideration to be included in purchase price at fair value, treating in-process R&D as intangible assets rather than expenses, and expensing acquisition costs immediately rather than capitalizing them. Understanding these changes and modeling deals accordingly can help reduce potential negative effects on financial statements from new fair value requirements. While complications may arise, the changes complete international convergence of standards and M&A activity can continue with proper planning and valuation expertise.
The Indian government introduced rollback provisions for Advance Pricing Agreements (APAs) to reduce litigation and align transfer pricing with international standards. Under the new rules, taxpayers can apply rollback of APAs to the previous four years for the same international transactions. This allows companies currently in dispute over transfer pricing for 2011-2015 to potentially resolve the issue through an APA. The rules provide the application process and require filing a modified return along with additional tax if needed. Rollback will only be granted if the return was originally filed on time and the case is not currently before the appellate tribunal. This rollback provision aims to give taxpayers pricing certainty for up to nine years through a forward-looking and rollback APA.
The document discusses the potential impacts of a proposed new revenue recognition standard on the automotive industry. The proposed standard would require a significant change in approach, moving to a single, contract-based model where revenue is recognized when performance obligations are satisfied, representing a transfer of control of goods or services. This would impact areas like IT systems, financial metrics, and legal contracts. Companies would need to fundamentally change their revenue processes under the new standard.
Dear Patron,
Here we are with the Thirty forth successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
Dear Patron
Here we are with the Thirty third successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
Rodel S. Navarro; Business and Management Consultant and Director; RODEL SY NAVARRO BUSINESS CONSULTANCY SERVICES (RSNBCS); Tel / Mobile: +63-0917-7333563; Email: rsnbcs@gmail.com http://www.slideshare.net/RSNBCS; (About Business Laws compilation): http://www.slideshare.net/BUSINESSLAWSPH Email: businesslawsph@gmail.com; https://www.slideshare.net/FREEPDFBOOKSPH; freepdfbooksph@gmail.com; www.slideshare.net/IFRS_IAS_COMPILED; ifrs.ias.compiled@gmail.com; https://www.slideshare.net/PH_STANDARDSONAUDITING_COMPILED; psauditing.compiled@gmail.com
Annual Procurement Planning Rule II - Procurement Planning.pdfMariaMicaEllaYT
The document discusses procurement planning and budgeting. It states that all procurement must be included in the Annual Procurement Plan (APP) and must be consistent with the approved budget. The APP is formulated based on Project Procurement Management Plans from implementing units and must be approved by the head of the procuring entity or their designee. The APP can be revised every six months and changes must be submitted to the Government Procurement Policy Board. Procurement can only be undertaken in accordance with the approved APP.
Key Direct Tax proposals announced by the Finance Minister on February 1, 2017.
CONTENTS on INCOME-TAX
1. Transfer Pricing
2. Non-resident
3. Corporates
4. Capital Gains
5. Assessments
6. Effect of Demonetisation
7. Other Amendments
8. Rates of Tax
This document outlines International Standard on Auditing 210 which deals with an auditor's responsibilities in agreeing the terms of an audit engagement. Some key points:
- The auditor must confirm that the preconditions for an audit are present, including determining if the applicable financial reporting framework is acceptable and obtaining management's acknowledgement of its responsibilities.
- The agreed terms of the audit engagement must be documented in writing, such as an engagement letter, and include items like the objective and scope of the audit.
- For recurring audits, the auditor assesses if the terms need revising or reminding. Any changes to terms require agreement and documentation.
- Additional considerations include whether the financial reporting framework is supplemented by law/
1) Advance Pricing Agreements (APAs) allow taxpayers to determine transfer pricing methods and arm's length prices for future international transactions in a cooperative manner to avoid potential disputes.
2) Taxpayers can apply unilaterally, bilaterally, or multilaterally for APAs. Bilateral and multilateral APAs require coordination between Indian and foreign tax authorities.
3) Extensive documentation must be provided including financials, functional analyses, critical assumptions, and proposed transfer pricing methodology.
This document provides an overview of IFRS 15, the International Financial Reporting Standard on revenue from contracts with customers. Some key points:
- IFRS 15 establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.
- The core principle is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled.
- IFRS 15 specifies the accounting for individual contracts and provides a practical expedient to apply the guidance to portfolios with similar characteristics. It applies to all contracts with customers except those in the scope
Developers have several potential next steps in response to the UK government's proposal to introduce contracts for difference (CfDs) for solar plants over 5MW starting April 1, 2015. These include: 1) Setting up framework agreements with main equipment suppliers; 2) Mechanizing the CfD application process for project pipelines of 50-200MW; and 3) Organizing "shovel ready" development packs with all rights and approvals in place. Developers may also look to aggregate resources with funders, manufacturers, and O&M providers to form larger solar companies that can more easily obtain CfDs and financing. The government aims to limit spending on solar and may take time to approve very large CfD applications
Due to the rapid spread of the novel coronavirus disease (COVID-19), India was forced to suspend most of its economic activities, considerably impacted the economy. Given that, suspension of economic activities may trigger debt defaults, the Government attempted to provide various reliefs to business.
Contract management , GFR Rules, Sampling and Testing.pptxsumitmmmecce
The document discusses rules 224-226 of the General Financial Rules of 2017 regarding contract management which specify that all contracts must be made by an authorized authority, general principles for contracts such as using standard forms and legal advice, and measures for enforcing general contract conditions such as approving technical representatives and sample materials. It also provides details on contract documents, price variation clauses, and other contractual terms.
The Government has enacted the CGST (Amendment) Act, 2018, the IGST (Amendment) Act, 2018, by publication in official Gazette to amend the respective GST Acts.
In this regard, we have captured major amendments in CGST Act, 2017 and IGST Act, 2017 for your perusal
The document discusses the proposed Results Management Framework for 2010-2012 and provides an overview of the revised General Conditions for IFAD financing agreements. Key changes include making the financing agreement shorter by moving standard provisions to the General Conditions, and removing the requirement for expenditures to be incurred in an IFAD member state. The General Conditions define terms like eligible expenditures and set rules around loan accounts, withdrawals, currency provisions, and project implementation through annual workplans and budgets.
Amendment to Finance Bill, 2017- Section 92CEDharmesh Shah
- Section 92CE was introduced to make transfer pricing adjustments mandatory in the books of account of the taxpayer and associated enterprise (AE) to reflect the consistent allocation of profits between them.
- Primary adjustments refer to adjustments that increase or decrease income/loss to align with arm's length pricing. Secondary adjustments require aligning the books of both parties with the primary adjustment.
- If excess funds are not repatriated to India by the AE, it will be deemed an advance from the taxpayer to the AE, on which interest must be computed. This could lead to further transfer pricing adjustments.
- Secondary adjustments in the AE's books may be difficult to implement practically, as the taxpayer and tax authorities have no control
The document discusses the accounting treatment for warranty provisions under construction contracts and revenue recognition by a public sector company. It notes the company's previous and current policies for warranty provisions and revenue recognition. The current policy recognizes warranty provisions progressively based on revenue recognized, while the previous policy deferred revenue recognition until trial completion. The querist seeks opinion on whether the current policy complies with accounting standards. The expert committee considers AS 7 and 29 and concludes that a warranty provision should be recognized when contractual obligations exist. As the company can reliably estimate warranty costs and follows the percentage of completion method, warranty costs should be recognized based on contract completion progress, in line with the company's current policy.
Dear Professional Colleagues,
Sharing with you "Budget Updates-2019". A brief analysis of:
1. Transfer Pricing Amendments
2. Individual Taxation-Tax Incentives
3. Tax Rates
Hope you will find it useful and informative too.
Regards
CA. Reetika G Agarwal
The document discusses the procedure and essential elements involved in preparing a final account. It defines key terms like final account, provisional sums, and prime cost sums. The procedure for final account involves the contractor submitting documents within 6 months of completion for the architect to complete the account within another 6 months. Adjustments must be made for variations, remeasuring provisional quantities, omitting unused provisional/prime cost sums, and adding back nominated subcontractors' accounts. Implications of omitting works from the bill of quantities and not allowing them as provisional sums are discussed from the client and contractor perspectives.
The document discusses changes to accounting standards for mergers and acquisitions (M&A) under FAS141R that will take effect in 2009. Key changes include stricter timing for reporting deals, requiring contingent consideration to be included in purchase price at fair value, treating in-process R&D as intangible assets rather than expenses, and expensing acquisition costs immediately rather than capitalizing them. Understanding these changes and modeling deals accordingly can help reduce potential negative effects on financial statements from new fair value requirements. While complications may arise, the changes complete international convergence of standards and M&A activity can continue with proper planning and valuation expertise.
The Indian government introduced rollback provisions for Advance Pricing Agreements (APAs) to reduce litigation and align transfer pricing with international standards. Under the new rules, taxpayers can apply rollback of APAs to the previous four years for the same international transactions. This allows companies currently in dispute over transfer pricing for 2011-2015 to potentially resolve the issue through an APA. The rules provide the application process and require filing a modified return along with additional tax if needed. Rollback will only be granted if the return was originally filed on time and the case is not currently before the appellate tribunal. This rollback provision aims to give taxpayers pricing certainty for up to nine years through a forward-looking and rollback APA.
The document discusses the potential impacts of a proposed new revenue recognition standard on the automotive industry. The proposed standard would require a significant change in approach, moving to a single, contract-based model where revenue is recognized when performance obligations are satisfied, representing a transfer of control of goods or services. This would impact areas like IT systems, financial metrics, and legal contracts. Companies would need to fundamentally change their revenue processes under the new standard.
Similar to Key amendments in transfer pricing (20)
Dear Patron,
Here we are with the Thirty forth successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
Dear Patron
Here we are with the Thirty third successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
Dear Patron
Here we are with the Thirty second successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
The document is the December 2013 issue of the monthly publication "Missive" from the Knowledge Management Team. It provides an index of topics covered in the issue, including Direct Tax, Transfer Pricing, Service Tax, and others. The main article summarizes several important tax court rulings on issues like TDS credit availability, interest liability for non-residents, capital gains tax rates for non-residents, and whether payments for ship charters constitute royalties. It also briefly summarizes other rulings related to transfer pricing documentation and the application of stamp duty valuation rules.
Here we are with the Thirtieth successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in thecontents. We would very much
appreciate your feedback which consistently helps us in improving and upgrading the contents.
This document provides an overview of domestic transfer pricing provisions in India. It discusses key concepts like specified domestic transactions (SDT), related parties, applicable sections like 40A(2) and 80A, documentation requirements, and penalties. SDT includes transactions between related parties exceeding INR 50 million annually. The scope was expanded based on a Supreme Court case suggesting potential for tax arbitrage with losses or differential tax rates. Documentation like functional analysis and economic analysis is required to demonstrate arm's length pricing of SDTs. Non-compliance can lead to disallowance of expenses or income adjustments along with penalties.
Dear Patron
Here we are with the Twenty Sixth successive issue of our monthly ‘Missive’.
We trust you will enjoy reading this Missive, even while soaking in the contents. We would very much appreciate your feedback which consistently helps us in improving and upgrading the contents.
Thanks and regards,
Knowledge Management Team
S.P.Nagrath & Co.
1. Services provided by lawyers are subject to service tax unless exempt.
2. Individual lawyers and law firm partnerships are exempt from service tax if they provide legal services to other lawyers, individuals, or small businesses with under Rs. 10 lakh turnover.
3. If exempt lawyers provide services to large businesses over Rs. 10 lakh turnover, the business must pay the service tax under reverse charge instead of the lawyer.
The document summarizes key changes to India's service tax laws effective July 1, 2012. Key points include:
1) The service tax rate increased from 10% to 12% and the system shifted from a positive to a negative list.
2) Many services were exempted from tax and new sections were introduced to define taxable services and the place of provision.
3) A reverse charge mechanism was introduced for three specified services and the abatement scheme was modified.
4) Procedural amendments included changes to invoicing rules, cenvat credit, and limitations periods.
1) Transfer pricing refers to the prices charged for transactions between related parties, such as multinational businesses. It aims to ensure transactions occur at arm's length prices, similar to unrelated parties.
2) Indian transfer pricing regulations are largely based on OECD guidelines and require extensive documentation and use the arm's length principle. Non-compliance can result in penalties.
3) Transfer pricing methods like comparable uncontrolled price method, resale price method, cost plus method, profit split method, and transactional net margin method are used to determine arm's length prices. Extensive documentation must be maintained.
The document provides an overview of India's transfer pricing legislation:
[1] It outlines the substantive provisions, including that transactions between associated enterprises must be computed using the arm's length principle. It defines key terms like international transaction, associated enterprise, and arm's length price.
[2] It also describes the procedural requirements for documentation and specifies penalties for non-compliance.
[3] Timelines for transfer pricing assessments and orders are included, as well as the roles of the Assessing Officer and Transfer Pricing Officer.
The document discusses advance pricing arrangements (APAs) in India. Key points:
1) APAs allow Indian tax authorities to agree transfer pricing methodologies with taxpayers for international transactions over 5 years, providing certainty.
2) APAs benefit both taxpayers and tax authorities by reducing disputes and compliance costs related to transfer pricing rules.
3) APAs can be unilateral between a taxpayer and India, or bilateral/multilateral also involving foreign tax authorities.
1. The key amendments in the 2012 Finance Act related to service tax include increasing the service tax rate from 10% to 12% plus a 3% cess, bringing in a negative list approach where only specified services will be taxed, and introducing reverse charge mechanisms for certain services.
2. Under the negative list approach, only services specified in the negative list and exempted list will remain outside the scope of service tax. All other services will be taxable unless specifically exempted.
3. The reverse charge mechanism will apply to certain services provided by individuals/firms to corporate entities, as well as services provided by the government and arbitrators. The recipient of these services will now be liable to pay the service
On 16 March 2012, the Honorable Finance Minister of India presented in the Parliament the country's Finance Bill for 2012-13, containing proposals on direct and indirect taxes, and key policy initiatives.
In this regard, with pleasure we are presenting our annual India Budget publication. The publication summarizes the key changes announced by the Finance Minister in his speech.
Most direct tax proposals in the Finance Bill 2012 are proposed to be effective from the financial year commencing on 1 April 2012 unless specified otherwise and indirect tax proposals are effective immediately, unless specified otherwise
We hope you find it an interesting and informative read.
Team SPN
Every business, big or small, deals with outgoing payments. Whether it’s to suppliers for inventory, to employees for salaries, or to vendors for services rendered, keeping track of these expenses is crucial. This is where payment vouchers come in – the unsung heroes of the accounting world.
A toxic combination of 15 years of low growth, and four decades of high inequality, has left Britain poorer and falling behind its peers. Productivity growth is weak and public investment is low, while wages today are no higher than they were before the financial crisis. Britain needs a new economic strategy to lift itself out of stagnation.
Scotland is in many ways a microcosm of this challenge. It has become a hub for creative industries, is home to several world-class universities and a thriving community of businesses – strengths that need to be harness and leveraged. But it also has high levels of deprivation, with homelessness reaching a record high and nearly half a million people living in very deep poverty last year. Scotland won’t be truly thriving unless it finds ways to ensure that all its inhabitants benefit from growth and investment. This is the central challenge facing policy makers both in Holyrood and Westminster.
What should a new national economic strategy for Scotland include? What would the pursuit of stronger economic growth mean for local, national and UK-wide policy makers? How will economic change affect the jobs we do, the places we live and the businesses we work for? And what are the prospects for cities like Glasgow, and nations like Scotland, in rising to these challenges?
An accounting information system (AIS) refers to tools and systems designed for the collection and display of accounting information so accountants and executives can make informed decisions.
Economic Risk Factor Update: June 2024 [SlideShare]Commonwealth
May’s reports showed signs of continued economic growth, said Sam Millette, director, fixed income, in his latest Economic Risk Factor Update.
For more market updates, subscribe to The Independent Market Observer at https://blog.commonwealth.com/independent-market-observer.
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck mari...Donc Test
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck maria r mitchell.docx
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck maria r mitchell.docx
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck maria r mitchell.docx
Fabular Frames and the Four Ratio ProblemMajid Iqbal
Digital, interactive art showing the struggle of a society in providing for its present population while also saving planetary resources for future generations. Spread across several frames, the art is actually the rendering of real and speculative data. The stereographic projections change shape in response to prompts and provocations. Visitors interact with the model through speculative statements about how to increase savings across communities, regions, ecosystems and environments. Their fabulations combined with random noise, i.e. factors beyond control, have a dramatic effect on the societal transition. Things get better. Things get worse. The aim is to give visitors a new grasp and feel of the ongoing struggles in democracies around the world.
Stunning art in the small multiples format brings out the spatiotemporal nature of societal transitions, against backdrop issues such as energy, housing, waste, farmland and forest. In each frame we see hopeful and frightful interplays between spending and saving. Problems emerge when one of the two parts of the existential anaglyph rapidly shrinks like Arctic ice, as factors cross thresholds. Ecological wealth and intergenerational equity areFour at stake. Not enough spending could mean economic stress, social unrest and political conflict. Not enough saving and there will be climate breakdown and ‘bankruptcy’. So where does speculative design start and the gambling and betting end? Behind each fabular frame is a four ratio problem. Each ratio reflects the level of sacrifice and self-restraint a society is willing to accept, against promises of prosperity and freedom. Some values seem to stabilise a frame while others cause collapse. Get the ratios right and we can have it all. Get them wrong and things get more desperate.
OJP data from firms like Vicinity Jobs have emerged as a complement to traditional sources of labour demand data, such as the Job Vacancy and Wages Survey (JVWS). Ibrahim Abuallail, PhD Candidate, University of Ottawa, presented research relating to bias in OJPs and a proposed approach to effectively adjust OJP data to complement existing official data (such as from the JVWS) and improve the measurement of labour demand.
STREETONOMICS: Exploring the Uncharted Territories of Informal Markets throug...sameer shah
Delve into the world of STREETONOMICS, where a team of 7 enthusiasts embarks on a journey to understand unorganized markets. By engaging with a coffee street vendor and crafting questionnaires, this project uncovers valuable insights into consumer behavior and market dynamics in informal settings."
In a tight labour market, job-seekers gain bargaining power and leverage it into greater job quality—at least, that’s the conventional wisdom.
Michael, LMIC Economist, presented findings that reveal a weakened relationship between labour market tightness and job quality indicators following the pandemic. Labour market tightness coincided with growth in real wages for only a portion of workers: those in low-wage jobs requiring little education. Several factors—including labour market composition, worker and employer behaviour, and labour market practices—have contributed to the absence of worker benefits. These will be investigated further in future work.
2. 7. With the approval of Central Government, the Board is empowered to
declare, any APA to be void ab initio, if it finds that the agreement has been
obtained by the person by fraud or misrepresentation of facts. Once an
Key amendments in relation to Transfer pricing agreement is declared void ab-initio, all the provisions of the Act shall apply
provisions proposed by Finance Bill 2012 to the person as if such APA had never been entered into. For the purpose
of computing any period of limitation under the Act, the period beginning
with the date of such APA and ending on the date of order declaring the
Key amendments agreement void ab-initio shall be excluded. However if after the exclusion of
the aforesaid period, the period of limitation referred to in any provision of
the Act is less than sixty days, such remaining period shall be extended to
A. Advance Pricing Agreement (APA) sixty days.
APA is an agreement between a taxpayer and a taxing authority on an
appropriate transfer pricing methodology for a set of transactions over a
9. Where an application is made by a person for entering into such an APA,
fixed period of time in future. The FB 2012 proposed to insert new sections
proceedings shall be deemed to be pending in the case of the person for
92CC and 92CD in the Act, to be effective from 1st July 2012, to provide a
the purposes of the Act
framework for APA under the Act and these sections provide the following-
10. The person entering in to an APA needs to furnish a modified return, for
1. It empowers Board, to enter into an APA with any person undertaking
the previous years to which APA applies, within a period of three months
an international transaction and such APA’s shall include determination of
from the end of the month in which the said APA was entered. The modified
the arm’s length price or specify the manner in which arm’s length price
return has to reflect modification to the income only in respect of the issues
shall be determined.
arising from the APA and in accordance with it.
2. The Arms length Price (“ALP”) of any international transaction covered
11. Where the assessment or reassessment proceedings for an AY
under such APA, shall be determined in accordance with the terms of APA
relevant to the FY to which the agreement applies are pending on the date
and the provisions of section 92C or section 92CA which normally apply for
of filing of modified return, the Assessing Officer shall proceed to complete
determination of arm’s length price would be modified to this extent.
the assessment or reassessment proceedings in accordance with the
agreement taking into consideration the modified return so filed and normal
3. The APA shall be valid for such previous years as specified in the
period of limitation of completion of proceedings shall be extended by one
agreement subject to a maximum period of five consecutive previous years.
year.
6. The APA shall be binding on the person and the revenue authorities, in
13. If the assessment or reassessment proceedings for an AY relevant to a
respect of the transaction in relation to which the agreement has been
FY to which the agreement applies has been completed before the expiry of
entered as long as there is no change in law or facts having bearing on
period allowed for furnishing of modified return ,the Assessing Officer shall,
such APA.
in a case where modified return is filed, proceed to assess or reassess or
recompute the total income in accordance with the APA and to such
3. assessment, all the provisions relating to assessment shall apply as if the C. Examination by the Transfer Pricing Officer of international
modified return is a return furnished under section 139 of the Act. The transactions not reported by the Assessee
period of limitation for completion of assessment or reassessment is one
The FB 2012 proposes to amend the section 92CA of the Act
year from the end of the financial year in which the modified return is
retrospectively to empower TPO to determine ALP of an
furnished.
international transaction noticed by him in the course of
proceedings before him, even if not referred to him by the
B. Transfer Pricing Regulations to apply to certain domestic transactions
Assessing Officer, provided that such international transaction was
The proposed amendment is the appreciation of the observation of the not reported by the taxpayer u/s 92E of the Act. This amendment
Supreme Court in the case of CIT Vs. Glaxo SmithKline Asia (P) Ltd., in will take effect retrospectively from 1st June, 2002.
which Supreme Court suggested to Ministry of Finance to consider It is also proposed to provide an explanation to effect that due to
appropriate provisions in law to make transfer pricing regulations applicable retrospectively of the amendment no reopening of any proceeding
to such related party domestic transactions, after examining the would be undertaken only on account of such an amendment.
complications which arise in cases where fair market value is to be The words “International transaction” wherever they occurred
assigned to transactions between domestic related parties. replaced by “International transaction or specified domestic
transactions”.
The Indian Income Tax law empowers the revenue authorities to
disallow unreasonable expenditure incurred between related parties.
Further, it also empowered to re-compute the income (based on fair D. Determination of Arm’s Length Price (ALP)
market value) of the undertaking to which profit linked deduction
Section 92C of the Act provides for set of methods for determination of
(section 80IA, 10AA etc.) is provided, if there are transactions with the
arms length price and mandates application of the most appropriate
related parties.
method for determination of arms length price (ALP) and where more
However, under existing law no specific method to determine
than one price is determined by application of MAM, the ALP shall be
reasonableness of expenditure or fair market value to re-compute the
taken to be the arithmetic mean of such prices.
income in such related transactions is provided.
Finance Act, 2002 inserted a proviso, to ensure that in case variation of
The FB 2012 proposes to extend the applicability of the transfer pricing
transaction price from the arithmetic mean is within the tolerance range
regulations to the above domestic related party transactions, if the
of 5%, no adjustment was required to be made to transaction value.
aggregate value of such transactions entered into by the tax payer in a
However, disputes arose regarding the interpretation of the proviso,
financial year exceeds 5 crores.
whether the tolerance band is a standard deduction or not, in case
Further proposed to amend the meaning of related persons as provided
variation of ALP and transaction value exceeded the tolerance band.
in section 40A, to include companies having the same holding
Further, there are various judicial precedents in favor and against of it.
company.
The Finance Act (No.2), 2009 substituted proviso and made clear the
This amendment will take effect from 1st April, 2013 and will,
intent of law that 5% tolerance band is not a standard deduction and
accordingly, apply in relation to the Assessment Year.
also changed the base of determination of the allowable band, linked it
to the transaction price instead of the earlier base of Arithmetic mean.
4. and details of transactions, taking benefit of which number of
The Act provided for the amendment to be effective from 1 October International Transactions are not being reported by taxpayers in
2009. There were some doubts on whether the amendment was transfer pricing audit report. Further, Certain judicial authorities have
applicable to all the pending proceedings as on 1 October 2009 or taken a view that in cases of transactions of business restructuring etc.
whether the amendment was applicable to audit proceedings for the
where even if there is an international transaction Transfer Pricing
financial year 2009-10 and subsequent years.
The FB 2012 proposes to introduce a clarifying amendment with provisions would not be applicable if it does not have bearing on profits
retrospective effect from 1 October 2009 to provide that the above or loss of current year or impact on profit and loss account is not
mentioned amendment shall be applicable for all audit proceedings determinable under normal circumstances.
pending as of 1 October 2009 instead of being attracted only in respect The FB 2012 proposes to amend the definition of “international
of audit proceedings for the financial year 2009-10 and subsequent transaction” by including as explanation, to include the following
years. categories of transaction within the scope of the definition:
However, the position prior to amendment by Finance (No.2) Act, 2009
still remained ambiguous with varying judicial decisions. It is, therefore, a) Tangible property transactions: the purchase, sale, transfer, lease or
proposed in FB 2012 to amend the ITA to provide clarity with use of tangible property including building, transportation vehicle,
retrospective effect in respect of first proviso to section 92C(2) as it machinery, etc., or any other article, product or thing;
stood before its substitution by Finance Act (No.2), 2009 so that the b) Intangible property transactions: the purchase, sale, transfer, lease
tolerance band of 5% is not taken to be a standard deduction while or use of intangible property, including the transfer of ownership or the
computing Arm’s Length Price. Also provides that due to such provision of use of rights regarding land use, copyrights, patents,
retrospective amendment already completed assessments or trademarks, licenses, franchises, customer list, marketing channel,
proceedings are not reopened only on this ground. The amendments brand, commercial secret, know-how, industrial property right, exterior
proposed above shall be effective retrospectively from 1st April, 2002 design or practical and new design or any other business or
and shall accordingly apply in relation to the Assessment Year 2002-03 commercial rights of similar nature;
and subsequent Assessment Years. c) Financial transactions: capital financing, including any type of long-
The ITL was further amended by the Finance Act, 2011 to provide that term or short-term borrowing, lending or guarantee, etc.;
instead of a variation of 5%, the allowable variation will be a percentage d) Provision of services: provision of market research, market
determined by the Central Government. development, scientific research, legal or accounting service, etc.;
The FB 2012 proposes to further amend the section to provide an e) Business restructuring: a transaction of business restructuring or
upper ceiling of 3% with respect to the power of the Central reorganization, entered into by an enterprise with an associated
Government to determine the tolerance range for the calculation of the enterprise, irrespective of the fact that it has bearing on the profit,
ALP. This amendment is proposed to be effective from 1 April 2012. income, losses or assets of such enterprises at the time of the
transaction or at any future date.
E. Definition of International Transaction
Further, the FB 2012 proposes to provide an explanation to define the
Section 92B of the Act, provides definition of “International term “intangible property” for the purposes of an international
Transaction”. As the existing definition does not mention all the nature transaction. It is proposed to define the term to include (a) marketing
related intangible assets; (b) technology related intangible assets; (c)
5. artistic related intangible assets; (d) data processing related intangible G. Amendment in section 271AA (Penalty Provision)
assets; (e) engineering related intangible assets; (f) customer related
intangible assets, such as customer lists, customer contracts, customer Under the existing ITL, Section 271AA provides penalty of 2% for
relationships; (g) contract related intangible assets, such as favorable failure to keep and maintain information and document in respect of
supplier contracts, license agreements; (h) human capital related International Transaction.
intangible assets, such as trained and organized work force, The FB 2012 proposes to amend Section 271AA to provide levy of a
employment agreements; (i) location related intangible assets; (j) penalty at the rate of 2% of the value of the international transaction, if
goodwill related intangible assets; (k) methods, programmes, systems, the taxpayer.- (i) fails to maintain prescribed documents or information
procedures, campaigns, surveys, studies, forecasts, estimates, or;(ii) fails to report any international transaction which is required to be
customer lists, or technical data; and (l) any other similar item that reported, or;(iii) maintains or furnishes any incorrect information or
derives its value from its intellectual content rather than its physical documents.
attributes. This penalty would be in addition to penalties in section 271BA and
271G.
This amendment will take effect retrospectively from 1st April, 2002 and This amendment will take effect from 1st July, 2012.
will, accordingly, apply in relation to the assessment year 2002-03 and
subsequent assessment years.
H. Income escaped assessment ( Section 147)
F. Extension of time period for filing of return of Income for Non Under existing ITL, Section 147 of the Act provides for reopening of the
Corporate assesses cases of the previous years, if any income chargeable to tax has
escaped assessment.
The FB 2012 proposes to amend Section 139 of the Act, to provide that in The FB 2012 proposes to amend Section 147 of the Act, to provide that
case of all assesses who are required to obtain and file Transfer Pricing in all cases where it is found that an international transaction has not
report as per Section 92E of the Act, the due date would be 30th November been reported either by non-filing of report or otherwise by not including
of the assessment year. such transaction in the report mentioned in section 92E then such non-
reporting would be considered as a case of deemed escapement of
This amendment will take effect retrospectively from 1st April, 2012 and income and such a case can be reopened under section 147 of the Act.
will, accordingly, apply in relation to the assessment year 2012-13 and This amendment will take effect from 1st July, 2012.
subsequent assessment years.
6. I. Appeal against the directions of the Dispute Resolution Panel (DRP) completion of assessments are as provided in section 144C
notwithstanding anything in section 153. A similar provision is proposed to
be made where assessments are framed as a result of search and seizure
Under the existing ITL, the Income Tax Department does not have the to provide that for such assessments, time limit specified in section 144C
right to appeal against the directions given by the DRP. However, the will apply, notwithstanding anything in section 153B. It is also proposed to
taxpayer has been given a right to appeal directly to the ITAT against provide for exclusion of such orders passed by the Assessing Officer in
the order passed by the Assessing Officer in pursuance of the pursuance of the directions of the DRP, from the appellate jurisdiction of the
directions of the DRP. Commissioner (Appeals) and to provide for filing of appeals directly to ITAT
The FB 2012 proposes to provide that the Assessing Officer may also against such orders. Accordingly, consequential amendments are proposed
file an appeal before the ITAT against an order passed in pursuance of to be made in the provisions of section 246A and 253 of the Income-tax
directions of the DRP. It is therefore proposed to amend the provisions Act.
of section 253 and section 254 of the Income-tax Act to provide for
filing of appeal by the Assessing Officer against an order passed in These amendments in the provisions of the Income-tax Act will take effect
pursuance of directions of the DRP in respect of an objection filed on or retrospectively from the 1st day of October, 2009.
after 1st July, 2012.
These amendments will take effect from the 1st day of July, 2012.
J. Power of the DRP to enhance variations
Further it is proposed to insert an Explanation in the provisions of
section 144C to clarify that the power of the DRP to enhance the
variation shall include and shall always be deemed to have included the
power to consider any matter arising out of the assessment
proceedings relating to the draft assessment order. This power to
consider any issue would be irrespective of the fact whether such
matter was raised by the eligible assessee or not.
Contact details:
This amendment will be effective retrospectively from the 1st day of
April, 2009 and will accordingly apply to assessment year 2009-10 and S.P.Nagrath & Co.,
subsequent assessment years.
A-380 , Defence colony , New Delhi -110024
K. Completion of assessment in search cases referred to DRP
Tel - +911149800027
Under the provisions of section 144C of the Income-tax Act where an Email - rashi@spnagrath.com/ nandita@spnagrath.com
eligible assessee files an objection against the draft assessment order
before the Dispute Resolution Panel (DRP), then, the time limit for