Taxmann International Taxation Ready Reckoner By Daksha Baxi, Surajkumar Shetty Edition September 2024

Taxmann International Taxation Ready Reckoner By Daksha Baxi

Taxmann International Taxation Ready Reckoner By Daksha Baxi

Description

This book is India’s first ‘ready reckoner’ specifically focused on the complexities of international taxation and cross-border transactions. It provides comprehensive coverage of essential topics, including the basic provisions of India’s taxation scheme, the concept of residence, and the crucial role of Double Taxation Avoidance Agreements (DTAA). The book also discusses the interaction between DTAAs and the Income-tax Act, guiding how to read a DTAA, determine eligibility, and resolve conflicts between a DTAA and domestic tax laws.

This handbook is helpful for tax professionals, legal advisors, tax practitioners, tax officers and businesses dealing with cross-border transactions, such as payments to non-residents, transactions involving non-residents, digital transactions, and the withholding tax obligations of residents. The second edition has been updated with the latest amendments from the Finance (No. 2) Act, 2024, and features expanded discussions, additional material, more case studies, and judicial precedents, providing in-depth analysis and practical insights into international taxation.

The Present Publication is the 2^nd Edition and has been amended by the Finance (No. 2) Act, 2024. This book has been authored by CA Daksha Baxi & Adv. Surajkumar Shetty, with the following noteworthy features:

• [Comprehensive Coverage] Covering a broad spectrum of topics, the book details the basic provisions, residential status, the role and application of Double Taxation Avoidance Agreements (DTAA), and their interaction with the Income-tax Act. It provides a step-by-step guide on how to read a DTAA, determine eligibility, and resolve conflicts between DTAA and the Income-tax Act
• [In-depth DTAA Analysis] It examines multiple DTAAs to demonstrate how tax implications can vary across treaties or remain consistent, providing clear explanations for these outcomes. This detailed analysis helps readers understand the nuanced application of DTAAs in various cross-border scenarios
• [Detailed Chapter Organisation] The chapters are organised to cover different types of income and transactions, such as rental income, business income, dividends, interest, royalties, technical services, capital gains, employment, and more. This structure brings together all relevant provisions of the Income-tax Act, including appropriate cross-references, making navigation straightforward for users
• [Taxability Evaluation] The book provides comprehensive guidance on evaluating the taxability of cross-border transactions using the Income-tax Act, DTAA and references to rules, forms, circulars, and landmark judicial precedents. This holistic approach equips readers to assess tax implications accurately and effectively
• [Practical Guidance for Advisors] Throughout the book, notes provide valuable insights into how advisors should approach transactions, the investigations required, and the application of the principles of the Income-tax Act and DTAA. This practical advice helps professionals offer sound, informed guidance on cross-border tax matters
• [Simplified Explanations] Complex concepts such as Place of Effective Management (PoEM), Permanent Establishment (PE), and business connections are explained in simple language, supplemented with practical examples and judicial precedents. Relevant statutory texts are reproduced verbatim for easy reference, aiding readers in understanding and applying the law
• [Special Focus on Investment Structures] The book discusses the taxation of Foreign Portfolio Investors and various investment funds, including Alternative Investment Funds (AIFs), Infrastructure Investment Trusts (InvITs), Real Estate Investment Trusts (REITs), and Securitisation Trusts. It specifically addresses scenarios involving non-resident investors in these structures
• [Litigation and Compliance] It provides an overview of provisions related to litigation proceedings under the Income-tax Act, Mutual Agreement Procedures (MAP) under DTAA, the Authority for Advance Rulings (AAR), equalisation levy, transfer pricing provisions, general anti-avoidance rules (GAAR), and special provisions for International Financial Services Centres (IFSC). This comprehensive coverage ensures professionals are well-prepared for compliance and dispute resolution
• [Illustrative Case Studies] To enhance practical understanding, the book includes numerous illustrations, practical examples, and comprehensive case studies. These are designed to cover various aspects of cross-border transactions, providing readers with insights into the subtleties and practical challenges involved

The structure and layout of the book is as follows:

• [25 Well-structured Chapters] dedicated to a specific area of international taxation, including detailed discussions on relevant provisions and practical guidance
• [Cross-references] to other chapters where necessary, ensuring clarity and ease of navigation and enhancing the reader’s ability to understand complex interrelationships within tax laws
• [Appendix] includes formats for relevant forms, updates on withholding tax rates, summaries of abbreviations, and comprehensive lists of withholding tax rates under India’s existing DTAAs, serving as a practical toolkit for professionals

The contents of the book are as follows:

• Tax System for Non-Residents in India – An Overview
• Tax Treaties
• Setting Up a Business in India
• Classification of Income
• Determining Eligibility to Claim Benefits of DTAA
• Taxation of Rental Income
• Taxation of Business Income
• Taxation of Dividend Income
• Taxation of Interest Income
• Taxation of Royalty Income
• Taxation of Income from Fees for Technical Services
• Taxation of Capital Gains
• Taxation of Employment Income
• Taxation of Non-Resident Indian
• Taxation of Foreign Portfolio Investors
• Taxation of AIFs, REITs, InvITs, Securitisation Trust
• Transactions Attracting Transfer Pricing Regulations
• Business Reorganisations
• Discontinuance of Business and Dissolution of Indian Company
• Foreign Tax Credit
• Making Payments to NRs & Obtaining Lower Withholding Certificate
• Assessments, Appeals and Dispute Resolution
• General Anti-Avoidance Rules
• Miscellaneous
• Case Study to Determine Taxability of NR, under the IT Act & DTAA

About the author

Daksha Baxi

Ms. Daksha Baxi is a distinguished tax adviser in India, consistently recognised by leading global surveys and ranking agencies for her expertise. She is a fellow member of both the Institute of Chartered Accountants in England & Wales and the Institute of Chartered Accountants of India, with an honours degree in Economics.

Daksha’s career spans over a decade and a half in the UK, Switzerland, and various parts of Europe and the USA, where she specialised in advising on cross-border investments and navigating bilateral tax treaties. Her return to India coincided with the country’s economic liberalisation, providing her with a unique opportunity to guide businesses through this transformative period. Inspired by India’s globalising economy, she established her professional philosophy: helping clients achieve their commercial objectives in an efficient and legally sound manner.

Her extensive experience includes significant tenures at premier law firms such as Nishith Desai Associates, Khaitan & Co., and Cyril Amarchand Mangaldas. Daksha’s work spans the full spectrum of international taxation, including domestic and international mergers and acquisitions, private equity investment deals, complex employee incentive programs, cross-border estate and succession planning, venture capital fund structuring, transactions under the Insolvency & Bankruptcy Code, and the establishment of InvITs and REITs. She has also represented clients before revenue authorities and secured landmark rulings before the Authority for Advance Rulings (AAR).

Daksha has contributed to the formulation of critical regulations, including the SEBI (Share Based Employee Benefits) Regulations, Alternative Investment Funds Regulations, and E-Commerce Taxation. She has advised SEBI on frameworks for Indian companies to list abroad and merge with foreign entities. A prolific writer, she has authored numerous articles and research papers on a wide range of tax issues, contributed to various publications of IBFD and Kluwer Law, and participated in international conferences and panel discussions, including those of the International Fiscal Association, Foundation for International Tax, International Bar Association, and STEP.

After a rewarding career with leading law firms, Daksha shifted her focus to serving smaller businesses, advising families on succession and estate planning, and teaching practical international taxation at various institutions. This book is a continuation of her passion for making complex tax matters accessible.

Daksha’s exemplary contributions to the field have earned her numerous accolades, including recognition as a top tax expert by:

• Euromoney’s World Tax Experts’ Guide
• Chambers & Partners
• Legal 500
• ITR – Women in Tax Leaders Guide
• Who’s Who Legal
• India Business Law Journal’s A-List of Top 100 Practitioners in India.

Her legacy as a leading tax expert in India is marked by her dedication to guiding clients through complex tax landscapes and her commitment to education and mentorship in the field.

Surajkumar Shetty

Surajkumar Shetty is an accomplished legal professional who is enrolled with the Bar Council of Maharashtra & Goa and has over 12 years of experience in advising clients on direct taxation. After completing his law degree, he has worked with some of India’s leading law firms, gaining extensive exposure to complex domestic and international tax matters.

Suraj specialises in advising clients on various income tax aspects, particularly in M&A transactions, business restructuring, risk mitigation, litigation strategies, and funds taxation. His expertise also includes drafting and negotiating agreements from an income tax perspective. He has represented both domestic and foreign clients before Indian tax authorities and has handled cases before the Income Tax Appellate Tribunal, High Courts, and the Supreme Court of India.

His client base spans diverse industries, including infrastructure, financial services, funds, manufacturing, and real estate. Beyond his practice, Suraj is an active contributor to the tax community. He has authored articles for renowned publications like the International Tax Review and IBFD and co-authored chapters in academically significant books published by the Chamber of Tax Consultants, the International Taxation Committee, and IFA Tax Conference (2013 Compendium). Suraj is also a sought-after speaker, having conducted sessions on taxation for tax professionals and law students.