India: Early provident fund withdrawals; share buybacks | KPMG | GLOBAL

India: Early provident fund withdrawals; share buybacks

India: Early provident fund withdrawals; share buybacks

The KPMG member firm in India has prepared reports describing the following tax developments (read more at the hyperlinks provided below).


Related content

  • Provident fund withdrawals: The Ministry of Labour and Employment issued guidance to amend the Employees’ Provident Funds Scheme, 1952 with regards to the provisions relating to the early withdrawal of provident fund accumulations on the cessation of employment. The notification’s effective date is 10 February 2016.
  • Tax officer lacks authority to recomputed book profit for minimum alternate tax (MAT) provisions: The Karnataka High Court held that the Assessing Officer is not authorized to recompute the taxpayer’s book profit for MAT purposes, but instead, must rely on “authentic statements” of the company as (1) certified by the statutory auditors, (2) approved by the company in a general body meeting, and (3) then filed with the Registrar of Companies. The case is: Sri Hariram Hotels (P.) Ltd.
  • Consultancy charges relating to construction activities, not taxable “fees for technical services”: The Delhi Bench of the Income-tax Appellate Tribunal held that the payment received for consultancy charges relating to highways, transportation, water supply, and waste management are not taxable as “fees for technical services” under provisions of the Income-tax Act, 1961 (the Act). The case is MSV International Inc.
  • Tax on share buybacks prior to 1 June 2013: The Central Board of Direct Taxes (CBDT) clarified that consideration received with respect to a buyback of shares—for the period 1 April 2000 to 31 May 2013—is taxable as capital gains to the recipient, and is not a dividend.

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


Request for proposal