Doing business in India

Doing business in India offers vast opportunities in a rapidly growing market of over a billion people. However, navigating the Indian tax landscape requires attention to various regulatory complexities and other tax levies. Staying informed about recent tax reforms and understanding the legal landscape can contribute to a smoother and tax-efficient business operation in the country. To read more, click on M2K’s Doing Business in India guide.

Our Key Services

Direct Taxes :

We assist corporates to deal with the various challenges arising from a complex tax environment. We assist companies across a spectrum of matters relating to applicability of withholding tax, deductibility of any expenditure, availability of exemption or enhanced deduction or tax holiday on any particular source of income or expenditure or investment. We also undertake corporate tax compliances ranging from advance tax computations, preparation and filing of tax returns, assistance with documentation requirements to support the planning and positions adopted for corporate and withholding tax matters.

We also assist companies in reducing their Effective Tax Rates within the legal framework and providing them clear guidelines for implementation. We also keep a close eye on decisions of Tribunals and Courts and use such learning into our planning, advisory and compliance services. We also frequently update our clients on any change in the tax regulations or on receipt of any particular judicial decision which could have an impact on the client or the industry.

Introduction of international concepts, bringing frequent amendments in the legislation in relation to international transactions with increase in number of tax treaties signed by India with other countries have added significant uncertainties and responsibility on the CFOs and Tax heads. As advisors, we help clients in meeting these new challenges and advise them on the appropriate course of action.

More specifically, we provide advice on withholding tax matters, determining the existence of permanent establishment (‘PE’) in India for a non-resident, advising on mitigating the PE exposure, advise on foreign tax credits, filing returns for non-residents and providing tax planning opportunities in relation to any international transaction which are within the legal framework of the law.

We also advise clients on any inbound/ outbound investment into/ outside India and help them to choose the right jurisdiction with the right funding option such that the investor yields a higher return. Our main focus is on researching and developing innovative solutions for the international transaction which meets the client requirements.

The Indian transfer pricing regulations requires the pricing of any international transactions between related parties to be at arm’s length and needs to be justified using the prescribed methods.

Transfer pricing requires a strong understanding of the facts of the company as well as the industry in order to determine the appropriate arms’ length price. Since these are fact driven, there are generally disputed by the tax authorities at lower level if the same are not adequately captured in the documentation. Transfer pricing is one of the most challenging tax issues in India and across the world and has a key influence on a company’s worldwide tax burden. Further, with action plans and amendment in the local laws and treaty to address the Base Erosion and Profit Shifting (BEPS) and General Anti Avoidance Provisions, maintaining of robust documentation & have the substance in place becomes very crucial for the corporate to defend its arm’s length test.

We assist clients in determining the arm’s length price, maintaining documentation to support the price adopted by the company before the tax authorities, providing planning opportunities at a group level. We also help clients in determining the right supply chain model or business model to optimize the effective tax rate at the Group level.

We represent clients at all stages from assessments proceedings to appellate proceedings (as well as Authority for Advance Rulings) to resolve tax disputes (including transfer pricing disputes). With respect to representation before High Court and Supreme Court, we have also liaised with the counsel for arguing the matter before the said Court.

We also assist clients in preparing legal and factual submissions to be made before the tax authorities/ appellate authorities in order to support their claim in the assessment/ litigation process.

Every restructuring exercise is unique and each one carries different challenges. While achievement of business drivers remains the paramount test of success, one needs to factor the impact of new risk dynamics, multiplicity of impact groups and an evolving legal framework. We go in depth to understand the client’s business and identify hitches, if any, at the stage of advice itself and bring an apt solution on the table which is implementable.

Restructuring involves number of legislations and it is critical that the ideas/ solutions are tested from the perspective of each legislation before execution. For this, we use our varied experiences to generate customized solutions that enable our clients to meet their business objectives.

Typical areas to be analysed in any M&A transaction are :

  • Direct and indirect tax laws framework
  • Corporate law & regulatory framework and governance
  • Financial and accounting related impacts
  • Other allied laws such as Competition Act, Shops & Establishment Act & other related regulations
  • Labour Laws (such as PF, ESI, Professional Tax, Payment of Bonus Act, Industrial Disputes Act, etc)
  • Securities laws for listed companies
  • Valuation aspects
  • Financing and capital instruments
  • Our methodologies are flexible and scalable to suit a variety of situations and stakeholders and are intended to provide value added solutions to clients.

We assist clients in providing the following personnel tax services in relation to expatriates, non-residents and high net-worth individuals (HNIs):

  • Review of tax computation and preparation of tax return
  • Identifying tax planning opportunities with respect to salary payments
  • Review of documentation to ensure that the position adopted by the clients are appropriate
  • Assistance in filing of quarterly withholding tax return in relation to salary payments
  • Assistance in issue of Form 16 to the expats
  • Assistance in representation before the tax authorities in relation to the aforesaid categories.

Indirect Taxes :

We assist clients in providing the following advisory services on GST :

  • Advising on GST on matters relating outward supplies, input tax credit availability, valuation mechanism, time and place of supply, changes in tax rates etc. and its impact on the business operations.
  • Giving opinions on tax issues
  • We assist clients in providing the following compliance services on GST :
  • Assistance in obtaining registrations under GST.
  • Preparation / Review of GST Returns including refunds.
  • Undertaking comprehensive Review of business operations to identify Opportunities and Compliance Gaps, if any.
  • Review of the GST implementation done by the company.
  • Preparation of annual reconciliation statements, i.e. returns with audited financial statements.
  • Drafting appeals, submissions and replies to notices.
  • Representing before adjudication and appellate authorities up to the tribunal.
  • Briefing legal counsel for appearance before High Court & Supreme Court.

We assist clients in the providing the following advisory services on FTP :

  • Advise on the optimization of cost / maximization of benefits in import / export transaction under Foreign Trade Policy schemes.
  • Assistance in obtaining registration
  • Assistance in preparation of application for export benefits under various schemes such as Merchandise Export India Scheme (MEIS) / Service Export India Scheme (SEIS), etc.
  • Assistance in preparation of application for EPCG / Advance Authorization including redemption related assistance.
  • Assistance in representation before the authorities.

Assurance & Accounting :

With our expertise knowledge in areas of Generally Accepted Accounting Principles (GAAP) i.e, Indian Accounting Standard, Securities and Exchange board of India (SEBI) – Issue of Capital and Disclosure Requirements (ICDR regulations) , we also assist Companies in preparation of various financial statements as required by SEBI ICDR for the purpose of inclusion in the offer document and also assist in other services for complying with the SEBI requirements which includes the following

  • Restated Ind AS Standalone and Consolidated Financial Statements for 3 years and Stub period
  • Proforma Consolidated financial statements (CPFS) for the group
  • Preparation of special purpose interim financial statements for the stub period.
  • Detailed Project Report (DPR)
  • Collation of historical key operating and financial data for presentation in Draft Red Herring Prospective (DRHP)/Red Herring Prospectus (RHP).

We recognize that the primary objective of internal audits is to provide the audit committee, senior management, head of operations, process owners, etc. of the organization with a comprehensive and fair analysis of the corporate governance processes, risks and functional efficiency of clients business and to suggest areas for improvement and value-addition

Our Internal Audit methodology is a risk based approach that focuses on our clients’ objectives and impediments to achieve those objectives

Our audit focus is on evaluation of internal controls, review of the existing business process, policies and practices, identify areas of revenue leakages and cost reduction, recommending practical solutions, compliance reviews etc.

We assist Companies in designing and documenting internal control over financial reporting (ICFR) framework comprising of the process narratives, flowcharts and risk control matrices for all relevant business cycles comprising of key processes and sub-processes by understanding its business operations and the environment in which the entity operates.

We also undertake testing of operating effectiveness of ICFR framework on behalf of management.

The challenge of Ind AS conversion projects will usually be very significant, as the differences between Indian GAAP and Ind AS are many. Ind AS poses technical accounting challenges to companies, particularly for standards like Revenue from Contracts with Customers (Ind AS 115), Financial Instruments (Ind AS 109), Joint Arrangements (Ind AS 111), etc. which are more complex than existing standards under Indian GAAP. We assist clients by designing Ind AS accounting, reporting, consolidation and reconciliation processes and controls.

We help our client in Ind AS implementation by establishing IndAS policies, evaluating the components, resolving issues and preparation of IndAS financial statements.

Due diligence is a process of research and analysis that is carried out before an acquisition, investment or business partnership in order to determine the value of the target of the due diligence or whether there are any major issues or potential issues.

M2K due diligence teams can assist with financial and tax due diligence for organizations that are contemplating investments, strategic partnerships, mergers, and acquisitions etc.

Financial due diligence: We offer financial due diligence services, both from an investor perspective (buy side) as well as seller perspective (vendor/ sell side), to help you realize the results you and your stakeholders desire. Our role in a financial due diligence review involves evaluating the proposed deal by analyzing the present and historical financial statements including important agreements, reviewing the control environment and assessing the risks incidental to the business.

Tax due diligence: When companies acquire a business, dispose of a business or go into a merger, they need to manage the tax risk by means of a tax due diligence. We provide you with corporate tax, direct and indirect taxes due diligence while focusing on risks (including quantifications) as well as opportunities.

Due diligence support services: On M&A transactions, our clients are demanding a wider range of services to support the diligence process. The aim of support services is to provide continuing assistance to a company that is considering the sale of all or part of its business in terms of preparation of financial information for the business, including tax information that is comprehensive and fit for a transactions diligence.

Finance services include whole gamut of services in relation to accounting, compliance, taxes, regulatory and MIS. Further, taxes and compliances are often a difficult subject for business owners. The tax rules keep changing and any non compliance with the same could lead to significant fines and penalties which can run in thousands/ lakhs of Rupees. We also help in providing insight and advice which helps entrepreneurs/ corporates make better decisions and grow their company by concentrating on their core competencies and leaving the financial and compliance burden on us.

Our expert finance and accounting team offer a wide range of accounting and financial reporting services, including maintenance of books of account, recording of day to day transactions, managing accounts payable, accounts receivable, Fixed Asset register, preparing MIS, reports, preparing financial statements, liaise with the auditors for timely completion of audit. In addition we also do payroll processing, statutory compliances under Income tax, GST, PF, ESI, Secretarial compliances etc.

With our expertise in knowledge of GAAP and relevant provisions related to financial statements, we can assist Companies in preparation of financial statements under the format prescribed under Companies’ Act ,2013 including preparation of consolidated financial statements for the group. We can assist in yearly closure of books and audit of the same by performing reconciliations usually requested by auditors such as
a) Expense as per P&L with TDS returns,
b) Revenue as per P&L with GST Returns,
c) Payroll expense with monthly pay register,
d) Sub Ledger /General ledger reconciliations,
e) Inter- ERP reconciliations such as Inventory system with Accounting system etc.
Further our services also include preparation of year-end closing balance schedules, responding to queries of auditors etc.

Others :

Valuation opinion requires the right blend of analysis, experience and professional judgement. Our team possess deep financial, valuation, and robust industry expertise and extensive delivery capabilities. We help companies identify, measure and realise the value of their assets by providing independent and well-supported valuations.

We undertake valuations of companies, shares, investment, business undertaking, etc. for internal restructuring, purchase, sale and for regulatory requirements under various statutes.

We help clients starting from deal negotiations, determining right valuation, due diligence, review of term sheets & agreements till the closure of the deal and also share unparalleled knowledge as we navigate the deal process with you. Whether you are making an acquisition or strategic alliance, in each case we have an aim to make sure you get the maximum return on your deal.

With deep sector knowledge, superior analytical skills (with significant audit experience) and a global mindset with local expertise, we help you achieve positive results. Our integrated team of specialists helps you navigate a complex & fragmented process so that you can address issues upfront and make your decisions count.

From raising or restructuring capital, to buying or selling a business, to making strategic and policy decisions based on value, we strive to provide objective advice to our clients, challenge conventional wisdom and employ creativity and skill in helping devise and execute a favourable outcome.

Succession Planning involves managing the transition of wealth to the next generation. It begins with understanding what you want to achieve with your wealth, both during your lifetime and beyond.

There are many techniques and structures available to preserve and pass on wealth. With increased complexity in tax and other regulations, determining the right structure which meets the objectives of the person/ family becomes a challenge. However, with our expertise knowledge in tax and regulatory laws and experience in handling succession planning, it makes us a boutique advisor in this space.

Preparation of financial statement in XBRL (eXtensible Business Reporting Language) has become mandatory requirement for corporates having turnover/ paid-up capital in excess of specified limit. With our domain expertise in finance, accounting , auditing and Company law , it gives an edge in preparation of financial statement in XBRL form with highest standards.

We also provide corporate law advisory services at all stages of a business cycle, right from the inception of an entity to handling complex transactions. Some of the services include:

  • Incorporation of companies.
  • Structuring of the entity as a Private Limited vis-à-vis Public Limited Company duly considering the objectives of the Company.
  • Corporate Social Responsibility (“CSR”)  expenditure.
  • Transactions between related parties and relevant regulatory framework (Inter-company investments/loans/guarantees) etc.
  • Capital Transactions (such as allotment of shares, transfer of shares, etc).
  • Advising on any corporate restructuring & planning.
  • Advising on mergers and acquisition (including drafting of scheme, coordinating with various stake holders, etc).

In addition to corporate laws in India, Indian companies having foreign shareholders or having customers or vendor located abroad or having financial transaction with banks are required to comply with the foreign exchange laws in India. Our services in this regard includes:

  • Advice on Foreign exchange transactions (such as foreign direct investment in India, external commercial borrowings in India, investment by Indian residents in overseas country, etc).
  • Undertaking compliances for the foreign currency transactions, both capital and current account transactions.
  • Assistance to the foreign companies in India for setting up branch office, liaison office, and project office along with the approvals required for setup.
  • Representation before authorities such as Reserve Bank of India, Department of Industrial Policy & Promotion,  etc.

Our Publications

Your Gateway to Global Tax Insights! Our alerts cover a wide range of tax-related subjects in various countries, helping you stay informed about the ever-evolving landscape of taxation. Whether you're a business professional, a tax enthusiast, or simply curious about international tax matters, our collection of articles is here to enlighten and empower you with valuable knowledge. Explore our publications and embark on a journey of global tax exploration. Click Here to view Publications

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