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Germany to India · PE

Permanent establishment risk for German companies in India

CA Utsav Dogra, Chartered Accountant, ICAI M. No. 542375 · Updated

In brief

A German company that has a fixed place, a dependent agent or a long project in India can become taxable in India on the profits attributable to it. Under the India–Germany tax treaty: Fixed place, dependent agents and construction or assembly projects beyond the treaty period.

What is specific to German companies

German engineers on installation and commissioning projects are the main PE risk; track project durations against the treaty period.

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Questions

Does having a subsidiary create a PE for the parent?

Not by itself. Risk arises from what parent staff or the subsidiary's people do on the parent's behalf.

General information as at 5 November 2026, not advice for a particular case. Indian and German rules change often; confirm the current position before acting. German law points should be confirmed with a German adviser.

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