Tax Advisory Services in India: Compliance, Planning, and Strategic Structuring

In an evolving tax landscape marked by digitalisation, globalisation, and increased scrutiny, tax compliance and planning are essential for businesses to operate efficiently and lawfully. Tax Advisory services help companies and individuals navigate complex Indian tax laws, minimise risk, ensure regulatory compliance, and optimise tax outflows.

Whether you’re a domestic enterprise, an international business investing in India, or a high-net-worth individual (HNI), sound tax advisory is critical to ensure alignment with the Income Tax Act, Goods and Services Tax (GST) regime, and applicable international tax treaties.

Scope of Tax Advisory Services

1. Direct Taxation

Corporate tax structuring and filings
Tax implications of cross-border transactions
Transfer pricing advisory and documentation
Capital gains tax planning
Taxation of ESOPs, dividends, and buybacks
MAT and AMT implications
Representation in tax audits and assessments

2. Indirect Taxation

GST registration, compliance, and return filings
Classification and valuation of goods/services
Input Tax Credit (ITC) optimisation
GST audits and assessments
Advisory on e-invoicing and e-way bill compliance
Representation before GST authorities and appellate tribunals

3. International Taxation and Cross-Border Advisory

Withholding tax advisory and compliance (Section 195, DTAA)
Interpretation and application of DTAA
Foreign tax credits and treaty planning
Permanent establishment (PE) risk assessment
Advisory on inbound and outbound investments
Equalisation levy and digital tax implications

4. Transaction Tax Advisory

Mergers, acquisitions, demergers, and business transfers
Share purchase and asset purchase transactions
Capital restructuring and buybacks
Slump sale vs itemised sale evaluations
Stamp duty planning and indirect tax implications

5. Litigation and Dispute Resolution

Income tax assessments, appeals, and rectification
GST notices, audits, and appellate proceedings
Prosecutions under tax laws
Advance ruling applications and representation before tax tribunals

Importance of Tax Advisory for Businesses

Regulatory Compliance: Avoid penalties and interest for non-compliance
Cost Efficiency: Tax planning can result in substantial savings
Risk Mitigation: Identify and reduce litigation risk and exposure
Transaction Support: Clean, tax-efficient deals increase investor confidence
Global Integration: Ensures alignment with international tax rules and BEPS norms

Key Laws and Authorities

Income Tax Act, 1961 (administered by CBDT)
Goods and Services Tax Acts (administered by CBIC)
Black Money Act, Benami Transactions Act, Transfer Pricing Rules
DTAA with over 90 countries
OECD BEPS Framework, GAAR

Frequently Asked Questions (FAQs)

1. What is the corporate tax rate in India?: 22% for domestic companies (15% for new manufacturing), plus surcharge and cess, subject to conditions.
2. Is GST applicable on export of services?: No. It is treated as a zero-rated supply. Refunds can be claimed for input tax credit.
3. What is transfer pricing and when is it applicable?: It ensures arms-length pricing for international/domestic related-party transactions to prevent base erosion.
4. Can NRIs claim relief under DTAA?: Yes, subject to Tax Residency Certificate (TRC) and required documents.
5. What is the penalty for late filing of income tax returns?: Penalty under Section 234F (up to ₹5,000), interest, and loss of carry-forward of losses.
6. What is the equalisation levy?: A tax on specified digital services by non-residents to Indian users.
7. Can tax disputes be settled without litigation?: Yes, via schemes like Vivad se Vishwas, advance rulings, and compounding provisions.
8. Is it mandatory for a company to have tax audit?: Yes, if turnover exceeds ₹1 crore (or ₹10 crore with digital transactions).
9. What are the risks of improper tax structuring in M&A deals?: It may result in double taxation, loss of benefits, or retrospective liabilities.