Significant Highlights of the Service Tax Amnesty Scheme, which was introduced by the Central Government as part of the Finance Act, 2013, and Domestic Transfer Pricing Regulations, brought into effect from FY 2012-13, were discussed at a Workshop, organized by RSM Astute Consulting Group today.
Dr. Suresh Surana, Founder of RSM Astute Consulting Group welcomed the participants and provided a broad outline of the Amnesty Scheme and Domestic Transfer Pricing Regulations, and their importance and related implications given the tightening compliance scenario.
CA Narendra Soni, Consultant – Service Tax, at RSM Astute Consulting Group discussed the Service Tax Amnesty Scheme as applicable to the concerned assesses.
Service Tax Amnesty Scheme was introduced to encourage Service Tax compliances and to increase the base of assesses. As per the scheme, an Assessee on making a voluntarily declaration, on or before 31 December, 2013, of tax dues payable from the period from October 2007 till December, 2012, can achieve compliance. As per the terms of the Scheme, immunity will be granted to such assessee from delayed interest, penalties and any other proceedings under the act provided the tax dues so declared are paid to the authorities within the specified date/s.
CA Rukshar Sidhwa, Senior Consultant – Transfer Pricing & Advisory, at RSM Astute Consulting spoke on certain relevant aspects of India Domestic Transfer Pricing Regulations.
As per the Regulations, with effect from FY 2012-13, in addition to International transactions, certain Domestic transactions between Related Parties is also being subject to the said regulation. This would require businesses to identify such related party domestic transactions which fall within the regulations’ ambit, understand their implications and demonstrate adequately that such transactions have been conducted / are being conducted at an Arm’s Length Price / terms only. The regulation also requires maintenance of adequate documentation and for filing of the prescribed form duly certified by a Chartered Accountant with the Tax authorities.
Given the significant exposures and litigations happening in the International Transfer Pricing regime, the inclusion of domestic transactions further increases the risk exposure of businesses and without a proper understanding, planning and compliance of the regulations, there could be very significant financial (tax) and litigation exposure on the business.