Share with your friends

India: Guidance for foreign companies, “place of effective management”

India: Foreign companies, place of effective management

India’s Central Board of Direct Taxes (CBDT) finalized guidance concerning the “place of effective management” standard and implications for foreign companies.


Related content

Section 115JH of the Income-tax Act, 1961 provides, in part, that the central government may address exceptions, modifications, and approvals of the rules for computation of income, the treatment of unabsorbed depreciation, the application of loss carryforwards and offsets, and rules relating to tax collection. 

In 2017, the CBDT issued draft guidance providing such exceptions, modifications, and approvals. The final guidance reflects special transitional provisions for a foreign company that is deemed to be a resident in India on account of its place of effective management. This guidance has a retroactive effective date of 1 April 2017.


Read a June 2018 report [PDF 504 KB] prepared by the KPMG member firm in India that includes a table that compares the measures in the draft guidance to the rules provided in the final guidance

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us


Want to do business with KPMG?


loading image Request for proposal