Microsoft's Indian operation has been landed with a hefty bill for back taxes and penalties after supposedly misinterpreting the tax rules surrounding the provision of marketing services.
The tax department has issued Microsoft with a bill for back taxes of USD28mn and a fine, also for USD28mn.
The company is accused by tax inspectors of falsely claiming that marketing services were being provided to the company's Singapore unit when they were actually being sold to Microsoft's Indian arm.
Under rules laid down in 2005 concerning the export of services, marketing services provided to another company in India cannot be classified as exports, as Microsoft had attempted to claim, according to tax officials. Therefore the services Microsoft provided in this instance were taxable within the scope of the business auxiliary services rules.
.
Network Tweets
Network BlogsContent
provided by
|
Archive | Resources | Partners | Site Map | Links | Newsletter Archive | Contact | RSS Feeds | About | Syndication | Advertising & Marketing | Recruitment | Terms & Conditions | Privacy & Cookies
Copyright © 2012 - All Rights Reserved - Tax-News.com
IMPORTANT NOTICE: Tax-News.com has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments.
Write a comment