International Taxation & Cross-Border Structuring

International Taxation & Cross-Border Structuring in Gandhinagar

As Indian businesses expand globally and foreign companies enter India, cross-border tax structuring becomes critical to avoid double taxation and optimise global effective tax rates. Morry's Business, a CA firm in Gandhinagar adjacent to GIFT City — India's international financial centre — provides comprehensive international taxation advisory covering inbound FDI, outbound ODI, DTAA application, Permanent Establishment analysis, and cross-border holding structure design.

Double Taxation Avoidance Agreements (DTAAs)

India has DTAAs with over 90 countries, each with specific provisions for business profits, dividends, royalties, FTS, and capital gains. Applying the correct DTAA requires determining: (1) the taxpayer's tax residency, (2) the nature of income under Indian domestic law, (3) the DTAA Article applicable, and (4) whether the DTAA rate is lower than the domestic withholding tax rate. We analyse the DTAA position for each cross-border payment, verify the counterparty's TRC, and file Form 10F where required to support the DTAA claim before an income tax authority.

Permanent Establishment (PE) Risk Analysis

A foreign company creates a "Permanent Establishment" in India if it has a fixed place of business (office, factory, construction site beyond 6 months), a dependent agent, or a service PE (183 person-days in a 12-month period). Once PE is established, the profits attributable to that PE are taxable in India at 40% (foreign company rate plus surcharge). We conduct PE exposure analysis for foreign companies with Indian operations — including virtual PE risks arising from remote-work arrangements post-COVID — and advise on structuring to limit PE creation.

Outbound Investment Structuring for Indian Companies

Indian companies investing overseas under the ODI (Overseas Direct Investment) route must comply with FEMA regulations — the aggregate ODI limit is 400% of the company's net worth. The choice of jurisdiction for the overseas holding company or subsidiary significantly impacts: withholding tax on dividends and royalties into India, capital gains tax on future exit, and availability of India's DTAA network. We evaluate Singapore, Mauritius, Netherlands, UAE, and GIFT City IFSC as options and recommend the most efficient structure for each client's specific facts.

GIFT City as an International Structuring Hub

GIFT City IFSC is rapidly emerging as a credible alternative to traditional offshore holding jurisdictions. With 10-year corporate tax holidays under Section 80LA, no DDT, access to India's full DTAA network, and lower operational costs than Singapore or Dubai, GIFT City offers unique advantages for pooling capital, fund management, and cross-border M&A. As Gandhinagar-based CA specialists with deep GIFT City expertise, Morry's Business is uniquely positioned to advise on GIFT City holding structures alongside conventional international tax planning.