International Tax Advisory

Corporate & International Tax:
Global Strategy, Local Compliance

For MNCs and internationally-oriented Indian groups: Transfer Pricing, DTAA optimization, POEM compliance, M&A structuring, and expat taxation. We bridge global ambition with Indian tax reality.

₹300 Cr
Largest TP Transaction
45+
MNC Clients
12
APAs Filed
90+
Treaty Countries

The International Tax Minefield

Cross-border operations expose you to multiple taxing authorities with conflicting interests. Getting it wrong means double taxation, penalties, and reputational damage.

Transfer Pricing Scrutiny

TPO adjustments are routine for MNC subsidiaries. Management fees, royalties, IT services—all are scrutinized for "arm's length" pricing.

Average TP adjustment in IT/ITeS sector: 15-25% of international transaction value.

POEM & Tax Residency

Foreign holding companies managed substantially from India may be deemed Indian resident—triggering worldwide income taxation.

Risk: Global income + Indian transfer pricing on all transactions.

Treaty Benefit Denial

DTAA benefits denied for missing Form 10F, Tax Residency Certificate, or "Beneficial Ownership" concerns. Full domestic withholding applied.

Difference: 10% treaty rate vs 20%+ domestic rate on payments abroad.

Expat Tax Complexity

International assignees face residency rules, split payroll issues, stock option taxation, and tax equalization complexities.

Mishandling = double taxation + unhappy employees + compliance risk.

International Tax Services

Transfer Pricing

TP documentation. Benchmarking studies. Master File, Local File, CbCR compliance. APA applications. TP audit defense.

Focus: Arm's length defensibility→

DTAA & Treaty Planning

Treaty benefit optimization. TRC and Form 10F management. PE avoidance structuring. Beneficial ownership planning.

90+ treaty countries covered→

POEM & Residency

POEM risk assessment. Substance implementation. Board meeting structuring. Residency documentation.

Protect: Offshore structures→

M&A Tax Structuring

Inbound & outbound deal structuring. Tax-efficient acquisitions. Cross-border reorganizations. Due diligence.

Optimize: Transaction tax cost→

Expat Taxation

Inbound & outbound assignee tax. Tax equalization. Split payroll. Stock option taxation. Return filing for expats.

Manage: Global mobility tax→

GAAR & BEPS Compliance

GAAR risk assessment. BEPS Action Plan compliance. Structure review for anti-avoidance rules. Documentation for business purpose.

Future-proof: Tax structures→
Case Study

MNC Restructuring: TP + POEM + Treaty Optimization

Client Profile

  • • US technology company with India subsidiary
  • • ₹200+ Cr annual intercompany transactions
  • • Singapore intermediate holding company
  • • 20+ expat employees in India
  • • Recent TP adjustment of ₹45 Cr

Issues Identified

  • TP documentation didn't support intercompany pricing
  • Singapore entity had POEM risk (directors in India)
  • Treaty benefits claimed without Form 10F
  • Expat taxation handled inconsistently

Our Solution

1. TP Defense + APA

Reduced adjustment from ₹45 Cr to ₹12 Cr. Filed bilateral APA for go-forward certainty.

2. POEM Remediation

Restructured Singapore board. Implemented quarterly off-shore board meetings. Documented genuine decision-making.

3. Treaty Compliance

Filed Form 10F for all treaty payments. Recovered excess TDS withheld in prior years.

4. Expat Policy

Implemented tax equalization policy. Regularized split payroll. Filed all pending returns.

₹33 Cr
TP Adjustment Reduced
5 Yrs
APA Certainty
Zero
POEM Risk
₹1.8 Cr
TDS Recovered
Questions & Answers

International Tax FAQs

Transfer Pricing, POEM, APA, GAAR, and expat taxation—answers for MNCs and globally-oriented Indian businesses.

Same transaction. Different authorities. Different rules.

Income Tax (TPO)

  • • Arm's length for profit allocation
  • • Methods: CUP, TNMM, PSM
  • • Wants higher India prices

Customs (SVB)

  • • Correct value for duty calculation
  • • Customs Valuation Rules
  • • Wants lower import value

Key Conflict: These authorities have opposing interests. Sami Tax coordinates IT TP and Customs SVB documentation to avoid contradictory positions.

POEM is where key management decisions are made 'in substance'.

To establish offshore POEM:

  • 1.Board meetings held physically outside India (not just video calls)
  • 2.Key decisions documented in minutes taken outside India
  • 3.Directors have real authority (not rubber-stamping Indian decisions)
  • 4.Bank signatories and treasury function outside India
  • 5.Key contracts negotiated and signed outside India

Sami Tax POEM service: We audit structures for POEM risk and implement corrective measures before it becomes a tax residency dispute.

APA gives you TP certainty for 5 years (with potential 4-year rollback = 9 years total coverage).

Consider APA when:

  • International transactions exceed ₹50 Cr annually
  • High-scrutiny industries: pharma, IT/ITeS, auto components
  • Complex or unusual pricing methodology
  • Past TP adjustments have been material
Unilateral APA: India only. Faster (18-24 months) but no MAP protection.
Bilateral APA: India + treaty partner. Complete certainty.

115BAA (22% rate) and 115BAB (15% for new manufacturing) are attractive but come with trade-offs:

✓ What You KEEP

  • • Foreign Tax Credit (Sec 90/91)
  • • DTAA treaty benefits
  • • Normal depreciation

✗ What You LOSE

  • • SEZ deductions (10AA)
  • • Weighted R&D deduction (35)
  • • Investment allowances

Sami Tax recommendation: We model both scenarios with your multi-year projections before recommending—115BAA often beats complex incentive structures for clean manufacturing/services.

GAAR applies when arrangement lacks commercial substance and main purpose is obtaining tax benefit.

Common GAAR triggers:

  • Round-tripping through low-tax jurisdictions
  • Treaty shopping via conduit entities
  • Artificial arrangements creating deductions
  • Separation of rights/risks inconsistent with commercial logic
Defense Strategy: Document genuine business purpose for every structure. Ensure real employees, real decisions, real risk. Sami Tax reviews structures for GAAR vulnerability and helps restructure.

Expat taxation is complex—multiple intersecting rules:

  • Residency182+ days = Indian resident = global income taxable
  • EqualizationEmployee pays hypothetical home-country tax; company bears actual
  • Split PayrollIndia taxes India-paid + services rendered in India
  • Stock OptionsIf exercised in India by resident—fully taxable

Sami Tax expat service: We structure packages, compute tax, manage equalization, and ensure treaty compliance—preventing double taxation and unhappy employees.

Elevate Your International Tax Strategy

Schedule a consultation with our international tax team. We'll review your cross-border structure, TP exposure, and treaty utilization.