pymts of due diligence reports done in foreing country?
This query is : Resolved
31 October 2010
Dear all,
ours is a pvt ltd company. we have formed a 100% subsidiary company in dubai.
we are in the process to acquire a company in italy. ours subsidiary company will hold shares in newly acquired company in itlay.
for the purpose of acquisition we have done due-diligence in Italy. for that we 've to pay Euro 30000.
we will pay this amt from our a/c.(holding co s a/c)
my question are..
1) will it be right to pay due-diligence exp from our a/c?
2) if yes, what rate tds to be deducted? ( payee doesn't 've any permanent est. in India, services recd in italy.)
3) if its not correct to pay this exp from our a/c then what will be other way to treat this transaction?
Waiting for experts reply..
Thanks in advance
Regards,
Sushil.
ours is a pvt ltd company. we have formed a 100% subsidiary company in dubai.
we are in the process to acquire a company in italy. ours subsidiary company will hold shares in newly acquired company in itlay.
for the purpose of acquisition we have done due-diligence in Italy. for that we 've to pay Euro 30000.
we will pay this amt from our a/c.(holding co s a/c)
my question are..
1) will it be right to pay due-diligence exp from our a/c?
2) if yes, what rate tds to be deducted? ( payee doesn't 've any permanent est. in India, services recd in italy.)
3) if its not correct to pay this exp from our a/c then what will be other way to treat this transaction?
Waiting for experts reply..
Thanks in advance
Regards,
Sushil.
31 October 2010
1) Not fully correct .But OK
2) Section 195 attracts if it the payment comes under "fees for technical services" (explantion 2 to section 9(vii)of IT Act,1961) vide the amendments in Finance Act,2010.
3) Subsidiary is acquirng Italian company. Better Dubai company meet the cost and pay it from there to circumvent 195.
2) Section 195 attracts if it the payment comes under "fees for technical services" (explantion 2 to section 9(vii)of IT Act,1961) vide the amendments in Finance Act,2010.
3) Subsidiary is acquirng Italian company. Better Dubai company meet the cost and pay it from there to circumvent 195.
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