Taxation of buybacks by unlisted companies: a step toward greater clarity?

Buyback tax (BBT) provisions were introduced in the Income Tax Laws (ITL) in 2013 to check tax avoidance by unlisted companies, which resorted to buyback of shares instead of dividend distribution, particularly where the buyback distribution proceeds were tax-exempt for overseas shareholders under the treaty network. BBT is payable by domestic unlisted companies in the … More Taxation of buybacks by unlisted companies: a step toward greater clarity?

Mergers and Acquisitions reforms essential to drive growth agenda

The Indian Finance Minister, Mr. Arun Jaitley, seems to be confident of pushing GDP growth upward and continuing the reforms agenda. At the recently concluded annual meeting of the World Economic Forum in Switzerland, he mentioned that one main reform, which is still work in progress, is “ease of doing business” in India and steps … More Mergers and Acquisitions reforms essential to drive growth agenda

Common Reporting Standards: an OECD step toward tax transparency

With increasing globalization, many tax payers started making, holding and managing investments through offshore financial institutions outside their country of residence. Such offshore money goes untaxed and such offshore tax evasion was considered a serious problem for jurisdictions all over the world. In this backdrop, cooperation between tax administrations is considered critical in the fight … More Common Reporting Standards: an OECD step toward tax transparency

Transactions in the BEPS world: the road ahead

“Coherence”, “transparency” and “substance” – these words have become the focal point of every discussion surrounding transactions today. In India, the glass ceiling on the importance of these terms was broken a few years ago with the advent of GAAR in the Direct Tax Code and retroactive amendments for taxation of indirect transfers. However, the … More Transactions in the BEPS world: the road ahead

Tax depreciation on Goodwill arising in M&A deals – is it a settled position?

Strategic acquisition of a target by an acquirer by paying the seller more than the company’s book net worth is fairly common in Mergers & Acquisitions (M&A) deals. The purchase price is generally based on the fair market value of assets/business. This typically occurs since the fair valuation of target factors in the value of … More Tax depreciation on Goodwill arising in M&A deals – is it a settled position?