Sub: Brief Note on Transfer Pricing
A) BRIEF INTRODUCTION :
The Multinational Groups normally transfer their taxable profits earned in India to some other country, where the rates of tax are lower than in India. In order to curb the practice of avoiding tax by the foreign companies in India, legislation under the name ‘Transfer Pricing Regulation’ has been introduced.
B) APPLICABILITY OF TRANSFER PRICING PROVISIONS :
a) Earlier the Transfer Pricing clause was applicable only to the International Transaction, but now it has been extended to Domestic transactions as specified in the Act only where value of Specified Domestic Transactions crosses INR 5 Crores.
Following transactions are covered under category of Domestic transactions:
• Section 40A – Expenditure paid or to be paid to related party as defined under section 40A(2)(b)
• Section 80IA – Inter unit transfer of goods and services as referred to in section 80IA(8)
• Section 80IA – Transaction between the tax payer and any other person owing to close connection as referred to in section 80IA(10) where more than ordinary profits are earned by business unit claiming tax holiday/deduction.
• Section 10AA – Any transaction under Chapter VIA or Section 10AA to which the provisions of 80IA apply.
more than ordinary profits earned by tax holiday/ exemption unit.
b) Each person or association who has involved in an international transaction/applicable transactions should maintain an up-to-date record of each transaction as prescribed by the legislation.
c) All income acquired by the company by means of any international transaction shall be calculated at arm’s length price.
d) There are various methods to calculate the arm’s length price, depending on the nature and type of the transaction, the nature of the group or the association involved, or any other features of the transactions involved.
e) If there are two or more appropriate prices assumed for a certain transaction, the arm’s length price will be calculated as the average of the prices.
C) SCOPE OF WORK:
Every person who has entered into an international transaction or specified domestic transaction shall keep and maintain such information and document in respect thereof, as may be prescribed. This shall include:
Preparation of TP Declaration or Disclosure Form
Submission of Detailed Audited financial statements
Making a copy of the income tax self-assessment
Making a copy of the income tax computation and all relevant schedules
D) DOCUMENTS REQUIRED:
Audited financial statements along with enclosures.
Ledger Accounts/Tentative Financials.
Detailed Bank statement for the specified Period.
Details of goods/services/transactions entered between the parties involved.
E) PLACE OF RENDERING SERVICES:
The place of rendering services generally shall be our office situated at 496B, 2nd Floor, Near KCC Classes, Kasba Peth, Pune-411011.
F) PROFESSIONAL FEES:
We are pleased to inform you that the standard Professional charges/fees for the assignment shall be depends on facts of the case.
For us clients are important and we are interested in keeping long term relationship with client’s always.
If any query please feel free to contact.
Thanking you and assuring best professional services.
Pramodkumar R. Ladda
I/we accept the above terms and conditions and authorize you to submit returns and documents with the government authorities on my/our behalf and also pay requisite filing and other fees and charges on our behalf.
Thanks & with warm regards !
For, CS Pramodkumar R. Ladda
Land line No. 020-24570055
Office Cell Nos: 9404923393, 8624919609, 9175395604
Personal Cell No. 9922735476 / 9595271145
Skype id: pramodladda
Office: 2nd Floor, OM Apartment, SR. No. 496/B, Near KCC Classes,
Opp. R. M. Kabara Electronics & RaleEstate, Kasba Peth, Pune 411011
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Along with Company Law we are also dealing in all types of Licensing, registrations and Liasoning services. Few areas in which we had already served to our clients are:
a) Business Setup Services
b) MPCB (Maharashtra Pollution Control Board) Consent To Establish
c) MIDC (Maharashtra Industrial Development Corporation) Provisional
d) Factory Inspector Approval
e) Ministry of Environment and Forests (MOEF)
f) Water Connection Sanction from MIDC
g) MSEDCL (Power) Approval
h) PESO (Petroleum and Explosive Safety Organization)
i) CCOE (Chief Controller of Explosives) Approval
j) Support for EIA (Environmental Impact Assessment) (EIA documentation by MITCON or other Authorities)
k) MPCB Consent to Operate
l) Any other statutory approval not indicated above
m) MIDC (Maharashtra Industrial Development Corporation) approvals
n) Fire (Petroleum and Explosive) Department approvals
o) SEZ (Special Economic Zones)
p) EOU (Export Oriented Units)
q) STPI (Software Technology Park of India)
r) PSARA License for Security Guard providing Agencies
s) Hotel Setup and Subsidies
t) Finding of land (especially in MIDC area) for Companies and do necessary things till allotment of land
u) RBI (Reserve Bank of India) various permissions and compliances
v) Recently we arranged FFMC (Full Fledged Money Changer) license for Pune based Company where Company now Authorised to do business of Dollar or other foreign currency conversion against INR
w) FEMA (Foreign Exchange Management Act)
x) FDI (Foreign Direct Investment)
y) NBFC (Non Banking Financial Companies)
z) Private Banking license (recent one week announcement by RBI)