Australia to India: questions Australian companies ask

A branch's Indian profits may be non-assessable in Australia under the foreign branch rules, but most groups still prefer a subsidiary for liability and flexibility.

Australian parents are usually Pty Ltd companies; use the exact legal name and ACN from the ASIC extract on every form.

DFAT issues apostilles for the whole country and must recognise the notary's signature, so use a notary DFAT holds on record.

An Australian who meets the 182-day test can be resident in both countries; the treaty's tie-breaker decides where they are taxed.

Australian-side costs cover notarisation and the DFAT apostille.

Australian documents are usually ready within one to two weeks.

India caps interest deductions on loans from non-resident associated enterprises at 30% of EBITDA, and Australia's thin capitalisation rules apply to the parent.

Australian accounting standards valuations are separate from the FEMA certificate.

The India–Australia treaty sets 15% on dividends, interest and royalties (10% for equipment royalties), and treats many technical fees as royalties. Services for more than 183 days in 12 months create a PE.

Dividends from a 10%+ holding are generally non-assessable non-exempt income in Australia; royalties and fees are assessable with a foreign income tax offset.

The ATO tests the same transaction under Division 815; significant global entities have extra obligations.

The 183-day service threshold is longer than in many treaties, but long project assignments still need tracking.

The International Dealings Schedule with the parent's return draws on Indian figures.

The 30 June Australian year means the Indian year spans two Australian years, so a reporting bridge is essential.

Provident fund replaces superannuation, and Fair Work standards do not apply in India.

The India–Australia agreement, in force since 1 January 2016, keeps secondees in superannuation for up to five years with an ATO certificate of coverage.

An executive may remain Australian resident under the domicile test, claiming Indian tax as a foreign income tax offset.

Under the Privacy Act, the Australian entity remains accountable for personal information it discloses to the Indian company.

Australian judgments need a fresh suit in India; ACICA or Singapore arbitration is common.

The India–Australia ECTA has been in force since 29 December 2022, with a broader agreement under negotiation.

Australian banks and technology firms run Indian centres that work Australian hours, which needs shift planning.

Australia's active foreign business asset reduction can reduce the gain on selling an active foreign company.