India has adopted Action Plan 13 of BEPS pursuant to which India has introduced significant additional documentation and reporting requirements for MNEs. It requires filing of Country-by-Country Report and Master File in case of certain companies in addition to existing requirement of Transfer Pricing Documentation / Transfer Pricing Report and are effective from FY 2017-17 (AY 2017-18).
Draft Rules for furnishing of Country-by-Country reporting and Master File were released on October 6, 2017. CBDT has, after taking into consideration public comments in respect of the same, notified the Final Rules in this regard vide Notification 92/2017 dated October 31, 2017. We have enclosed herewith Tax Alert on the final rules notified by the CBDT for your reference and further understanding.
It is important to mention that all the foreign MNCs with consolidated turnover of more than Rs. 500 crores (approx. USD 75 Million) (and certain additional conditions of the value of intra-group transactions) having subsidiaries in India are mandatorily required to file Master File with Indian tax authorities and this requirement is effective for Financial Year 2016-17 (April through March).
This update may be relevant for clients of BKR members worldwide having Indian subsidiaries.
Download the tax alert at https://bkr.com/cmsAdmin/uploads/k-c-mehta-&-co-country-by-country-report-and-master-file.pdf.