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The Finance Bill 2015 had amended Section 6(3) of the Income Tax Act, 1961 to bring in the concept of Place of Effective Management ('POEM') for determination of residence of companies in India w.e.f. AY 2016-17. The Explanatory Memorandum to the Finance Bill, 2015 had stated that guiding principles to be followed for determination of POEM shall be issued for the benefit of the taxpayer as well as the tax administration. Pursuant to the same, the Central Board of Direct Taxes (Ministry of Finance, Government of India) vide F. No. 142/11/2015-TPL dated 23rd December 2015 recently released 'Draft Guiding Principles for Determination of Place of Effective Management of a Company' in this regard. It can be accessed by clicking here.
Responding to the public invitation to send comments to such draft guidelines, our firm has sent suggestions to the CBDT on further improvement of the proposed rules. We are pleased to share with you our suggestions on the 'Draft Guiding Principles for Determination of Place of Effective Management of a Company'. You can read our suggestions by clicking here.
We hope the same would interest you.
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