Tax and Finance Practice
Our Tax and Finance practice advises businesses on corporate tax structuring for transactions and operations, GST compliance as an ongoing operational discipline, international taxation and transfer pricing, and the documentation of financing arrangements. Our advisory is transactional and structuring in nature — advising on tax implications before structures are finalised and implemented, rather than managing disputes after assessments are made.
- Tax structuring at the transaction stage costs a fraction of what post-transaction tax exposure costs after the structure is finalised. We advise on the tax implications of M&A structures, cross-border arrangements, and reorganisations before implementation.
- GST compliance is an operational discipline, not a periodic filing exercise. Rate classification, input tax credit eligibility, and the correct treatment of multi-state and cross-border supply must be determined at the point of business model design.
- Transfer pricing in India requires arm’s length pricing for specified transactions between associated enterprises. The Rule 10D documentation requirement must be maintained annually for each year in which specified transactions occur.
- Indirect transfer taxation under Section 9(1)(i) of the Income Tax Act, 1961 can apply to offshore transactions involving Indian assets. We assess indirect transfer exposure in cross-border M&A transactions as a standard step.
- Finance documentation in India involves multiple layers: FEMA ECB framework for cross-border loans, Companies Act for charge registration, state-specific stamp duty on security documents, and the IBC framework for enforcement against corporate debtors in insolvency.
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Corporate Tax Structuring — Our Advisory
We advise on the tax implications of entity structure choices, M&A deal structures, cross-border arrangements, and internal reorganisations before implementation. For M&A transactions, we advise on the tax treatment of share sales versus asset sales versus mergers, on the availability of carry-forward of losses under the Income Tax Act, 1961, and on the Section 47 exemptions available for certain tax-neutral reorganisations. For cross-border structures, we advise on permanent establishment risk from seconded employees, withholding tax obligations on payments to non-residents, and the treaty network available to reduce withholding tax rates.
GST Compliance and Advisory
We advise businesses on GST compliance across the CGST, SGST, IGST, and GST Compensation Cess framework. Our GST advisory covers: rate classification for new products and services; input tax credit eligibility and the conditions under which ITC is available or must be reversed; the place of supply rules that determine whether a transaction is intra-state or inter-state; the GST implications of business models involving marketplaces, intermediaries, and bundled supplies; and the invoicing, return-filing, and reconciliation obligations that GST compliance requires on an ongoing basis.
“The most expensive tax advice is the advice that comes after the transaction has been structured — because at that point most of the options are already closed. We advise before implementation, not after.”Transfer Pricing — Documentation and Advisory
Indian transfer pricing rules under Sections 92 to 92F of the Income Tax Act, 1961 require arm’s length pricing for specified international transactions between associated enterprises. The documentation requirement under Rule 10D must be maintained annually and must be produced to the Assessing Officer if called for. We advise on transfer pricing policy design, inter-company agreement documentation consistent with the transfer pricing policy, and annual compliance documentation.
Finance Documentation and Structured Finance
We advise on the documentation of domestic and cross-border lending transactions, security creation over movable and immovable property, debenture issuance and documentation, and structured finance arrangements including securitisation and assignment of receivables. Finance documentation in India involves: the FEMA framework for cross-border loans (External Commercial Borrowings regulations) for cross-border lending; the Companies Act for creation and satisfaction of charges; state-specific stamp duty on security documents; and the IBC framework for enforcement of security interests against corporate debtors in insolvency. Finance documentation that is not correctly structured at the point of execution creates significantly more difficulty at the point of enforcement. Across 13 partners and 220+ professionals from offices in New Delhi, Mumbai, Chennai, Hyderabad, and Bangalore.
Frequently Asked Questions
tax-and-finance-practice-faq
The key tax considerations in an Indian M&A transaction include: the tax treatment of share sales versus asset sales (capital gains tax, stamp duty, and input tax credit treatment differ materially); the availability of carry-forward of accumulated losses under Sections 72 and 72A of the Income Tax Act, 1961 in a share acquisition or a merger; the Section 47 exemptions available for certain tax-neutral reorganisations; indirect transfer taxation under Section 9(1)(i) for cross-border transactions involving Indian assets; and withholding tax obligations on payments to non-residents.
The Goods and Services Tax (GST) is a destination-based, multi-stage indirect tax levied on the supply of goods and services in India, administered jointly by the central government (CGST), state governments (SGST), and the central government for interstate supplies (IGST). Businesses with aggregate turnover above the prescribed threshold — currently ₹40 lakh for goods and ₹20 lakh for services for most states, with lower thresholds for certain special category states — must register for GST. [PLACEHOLDER: verify current registration thresholds before publication].
Transfer pricing rules under Sections 92 to 92F of the Income Tax Act, 1961 require that specified international transactions between associated enterprises — entities where one directly or indirectly controls the other, or both are controlled by the same entity — be priced on an arm’s length basis. Covered transactions include: purchase, sale, or lease of property; provision of services; lending or borrowing of money; and any other transaction affecting profits. The documentation requirements under Rule 10D must be maintained annually.
External Commercial Borrowings (ECBs) are commercial loans raised by Indian entities from foreign lenders. They are governed by FEMA 1999 and RBI’s ECB Master Directions. ECBs are permitted for specified eligible borrowers from recognised lenders, for minimum average maturities, up to permitted end uses, and within applicable all-in-cost ceilings. RBI’s ECB framework distinguishes between ECB under the automatic route (where RBI approval is not required, subject to conditions) and the approval route. [PLACEHOLDER: verify current ECB conditions at rbi.org.in before reliance].
Stamp duty on finance documents in India is governed by state-specific stamp legislation, which varies significantly across states in applicable rates and the documents that attract duty. Security documents — mortgages, hypothecation agreements, and pledge documents — attract stamp duty at state-specific rates that can be a material transaction cost for large financing. We advise on stamp duty implications as part of the overall financing structure and on execution arrangements designed to manage stamp duty exposure where permissible.