Home / Practices / Cross-Border Tax & Structuring

FOR COMPANIES AND INDIVIDUALS OPERATING ACROSS BORDERS

Cross-Border Tax & Structuring.

Double Taxation Avoidance Agreement analysis across 90+ tax treaties, Form 15CA and 15CB certification, Outward Direct Investment structuring, PFIC and GILTI analysis for US persons, Section 195 TDS across global corridors.

01 · What we do

Our work in this practice

Cross-border tax is the discipline of identifying the correct tax treatment of any payment, asset, or transaction that crosses a national boundary, by integrating the domestic tax laws of the origin and destination jurisdictions with the applicable tax treaty. India has signed DTAAs with over 90 jurisdictions, and the practical operation of each treaty is shaped by specific articles on permanent establishment, business profits, dividends, interest, royalties, technical services, capital gains, employment income, pensions, and the Foreign Tax Credit mechanism.

DTAA position analysis is the foundation of every cross-border engagement. For a payment from India to a foreign recipient, the analysis covers classification under Indian domestic tax law (Sections 9, 195), the treaty article applicable to the payment classification, the rate of tax under the treaty versus the domestic rate (the taxpayer is entitled to the lower of the two), documentation required to claim the treaty benefit (Tax Residency Certificate, Form 10F, No-PE declaration where applicable), and Form 15CA and 15CB certification for the remittance.

Form 15CA and 15CB are the operational filings for any foreign remittance from India where the payment is in the nature of income to the recipient. Form 15CB is the Chartered Accountant's certificate certifying the nature of the payment, applicable tax treaty position, TDS compliance, and foreign exchange compliance. Form 15CA is the remitter's declaration filed with the Income Tax Department before the remittance. The Authorised Dealer bank requires both forms before processing the outward remittance.

Outward Direct Investment under the Foreign Exchange Management (Overseas Investment) Rules 2022 is the framework for Indian resident entities and individuals investing in foreign businesses. The ODI categories include Direct Investment in a Foreign Entity (subject to Net Worth and limit-based restrictions), Investment in Listed Foreign Securities, Acquisition of Foreign Real Estate (substantially restricted), and the Loan and Guarantee framework. Compliance covers Form FC-RBI for the ODI report, the annual Performance Report, the Annual Return on Foreign Liabilities and Assets, and the divestment route at exit.

US persons (citizens, green card holders, US tax residents) with Indian assets face an additional layer of US-side complication. Principal exposures include Passive Foreign Investment Company (PFIC) treatment of Indian mutual funds and certain Indian holdings, Subpart F and Global Intangible Low-Taxed Income (GILTI) treatment of controlled foreign corporations, Foreign Bank Account Report (FBAR) for Indian bank accounts, Form 8938 Foreign Financial Asset disclosure, and Form 5471 Information Return on Foreign Corporations. Our practice covers the Indian-side position and coordinates with US CPAs for integrated analysis.

Section 195 TDS on foreign payments covers operational compliance for any India-based payer remitting to a foreign recipient. The TDS rate ranges from 5% to 40% depending on payment classification, applicable treaty, and recipient's documentation status. The framework includes Form 27Q quarterly return, Form 16A certificate to the foreign recipient, equalisation levy provisions for certain digital transactions, and GAAR considerations for treaty shopping.

Treaty shopping and GAAR (General Anti-Avoidance Rules) analysis is increasingly relevant for cross-border structures relying on intermediate holding jurisdictions. The GAAR framework, in force from April 2017, permits the tax authority to disregard arrangements entered into primarily for tax avoidance purposes lacking commercial substance. Our practice covers the GAAR position memorandum for material cross-border structures, documentation of commercial substance, and defensive support if challenged.

02 · Who this is for

Client profiles

Indian companies with cross-border revenue

Companies with foreign customers, foreign subsidiaries, foreign IP licensing, or foreign service providers, requiring DTAA analysis, TDS position memoranda, and transfer pricing alignment.

Foreign companies remitting to India

Foreign companies making payments to Indian recipients (services, royalties, dividends, interest, technical fees), requiring the treaty position from the foreign-side withholding obligation perspective.

Indian residents with foreign income

Indian residents receiving foreign-sourced income or holding foreign assets, requiring DTAA claims, Foreign Tax Credit claims under Section 90, and Schedule FA disclosure.

US persons with India connection

US citizens, green card holders, and US tax residents with Indian business interests, investments, or family holdings, requiring integrated India-US tax planning and FBAR/FATCA compliance.

03 · How we engage

Engagement structure

DTAA position memorandum

Treaty analysis for specific cross-border transactions or structures, with integrated position across source and recipient jurisdictions, supporting documentation list, and compliance pathway.

Form 15CA and 15CB certification

Operational issuance of Form 15CB certificates and Form 15CA filings for cross-border remittances, coordinated with the Authorised Dealer bank.

Outward Direct Investment structuring

ODI category selection, Form FC-RBI filing, annual Performance Report, FLA filing, and the divestment framework at exit.

US person India advisory

Integrated India-US tax advisory covering PFIC analysis, GILTI implications, FBAR and Form 8938 disclosure, and optimal structuring of India-side holdings.

04 · Representative scenarios

Illustrative engagements

Representative scenario

Royalty payment from Indian company to US parent

An Indian subsidiary licenses software from its US parent under a licensing agreement, with annual royalty of USD 2 million. Considerations: royalty classification under Article 12 of the India-US treaty (15% treaty rate, 25% domestic rate), TDS compliance under Section 195 at treaty rate, No-PE declaration from US parent (Form W-8BEN-E with India treaty election), Form 15CB certification per remittance, Section 92 transfer pricing position on the royalty rate (defensible 2% to 6% of revenue), and GAAR position on the licensing arrangement. Engagement: integrated position memorandum, per-remittance Form 15CA/15CB, and annual transfer pricing study.

Representative scenario

Indian individual investing in Singapore startup

An Indian resident is making a USD 500,000 angel investment in a Singapore-incorporated startup. Considerations: Outward Direct Investment route under FEMA OI Rules 2022, Form FC-RBI filing, structural choice (direct investment versus through LLP versus through Family Trust), future exit treatment (LTCG under Section 112A with treaty interaction), and annual reporting compliance (FLA Return, Annual Performance Report). Engagement: ODI structuring memorandum, Form FC-RBI filing, annual reporting, and exit advisory.

Representative scenario

US-citizen co-founder of Indian startup

A US-citizen co-founder of an Indian B2B SaaS startup, holding 35% equity in the Indian Private Limited Company, requires integrated India-US tax planning. Considerations: PFIC analysis of the Indian holding from US side (typically not a PFIC for active operating companies), GILTI analysis on controlled foreign corporation income, FBAR and Form 8938 disclosure of Indian holdings, Indian-side tax position on founder compensation and ESOP exercise, and potential restructuring to a Delaware C-Corporation parent. Engagement: integrated position memorandum, ongoing annual compliance support coordinated with US CPA, and flip-structuring memorandum if contemplated.

05 · Frequently asked

Questions clients ask

Is a Tax Residency Certificate sufficient to claim treaty benefits?

A TRC from the recipient's home jurisdiction is necessary but not sufficient. The full documentation typically required includes the TRC, Form 10F (self-certification of treaty applicability), the No-PE declaration where applicable, and the underlying contract supporting payment classification. The Income Tax Department also retains the right to assess commercial substance, particularly for intermediate holding jurisdictions, under the GAAR framework.

What is the typical timeline for Form 15CB issuance?

For a routine cross-border remittance with complete documentation, Form 15CB issuance is typically 2 to 3 working days from instructions. Complex transactions (royalties with transfer pricing dimensions, intermediate jurisdiction holdings, novel payment structures) may take 5 to 10 working days, including the position memorandum supporting the certificate. Form 15CA is filed by the remitter (or by us on the remitter's behalf) following the 15CB issuance.

Does India have a tax treaty with my country?

India has DTAAs with over 90 jurisdictions including the US, UK, Singapore, UAE, Canada, Australia, Germany, France, Netherlands, Switzerland, Mauritius, Cyprus, Ireland, Luxembourg, Malta, and most major economies. The DTAA framework varies materially across treaties. Our position memorandum for any specific transaction covers the applicable treaty with the specific article references.

What is the difference between Form 15CA and Form 15CB?

Form 15CB is the Chartered Accountant's certificate certifying the tax position on a foreign remittance, including the nature of the payment, applicable tax treaty rate, and TDS compliance. Form 15CA is the remitter's declaration filed with the Income Tax Department in electronic form, typically accompanied by the Form 15CB. For remittances below certain thresholds or specified exempt categories, the requirements may be relaxed.

How is the equalisation levy different from Section 195 TDS?

The equalisation levy is a separate charge imposed on specified digital services received in India from non-resident providers, at 2% on the gross consideration. It applies to e-commerce supplies and certain digital advertising services. Unlike Section 195 TDS, the equalisation levy is the legal liability of the non-resident, though typically collected from the Indian customer. The levy is in addition to (not in lieu of) any income tax obligation.

Does Advisory Monks coordinate with US CPAs for US person advisory?

Yes. Integrated India-US tax advisory typically requires coordinated work between an Indian Chartered Accountant (covering the India-side position) and a US CPA (covering the US-side position). Our practice operates routinely with US CPAs, and where the client does not have one, we can introduce qualified partners through our Global desk.

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Tell us about your facts. We will respond with a structured approach.

Each engagement begins with a structured workshop covering your specific facts, timeline, and constraints. We respond with an option analysis and indicative fee within five working days of the initial discussion.

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