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Consolidation of Financial Statement of Susdiary with Parent Company and Branch with Head office

Anurag Mishra (1 Points)

24 May 2021  

I read Ind As 21 , but it could not make me clear so can anyone provide the better and valuable suggestions on my below query of ITR filing  on the Consolidated  financial statement of Subsidiary Company with its Parent/holding company And Branch office with its Head office -:

- Can we calculate income tax and file ITR on the basis of consolidated P&L statements when Head Office is registered in India but Branch office is registered in foreign territory (Branch office is being regulated by foreign tax laws) ?

- Can we calculate income tax and file ITR on the basis of consolidated P&L statements when Parent/Holding company is registered in India but Subsidiary is registered in foreign territory ( Subsidiary is being regulated by foreign tax laws) ?

- Can we calculate income tax and file ITR on the basis of consolidated P&L statements when Parent/Holding company is registered in India and Subsidiary is also registered in India ( Subsidiary has its separate existence having pan, tan) ?

 

 


 2 Replies

Jay Chichani (126 Points)
Replied 24 May 2021

In Income Tax Act 1961, Assessee Income assessment is based on PAN basis not on basis of CFS . So, Subsidiary is treated as separate Assessee due to have Different PAN as compare to Parent PAN
There is no concept of Consolidated FS Tax basis in Income Tax hence you need to file 2 ITR I.e Parent and Subsidiary Seprate.
1 Like

veerendar singh (tax consultant) (2818 Points)
Replied 24 May 2021

Income tax is paid on the basis of stand alone financial statements.
1 Like

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