The Branch Office (BO) in India is subject to income tax on its net earnings as per corporate tax rates:
- For income below INR 1 crore: 36.4% (including surcharge and education cess).
- For income between INR 1 crore and INR 10 crore: 37.13% (including surcharge and education cess).
- For income above INR 10 crore: 38.22% (including surcharge and education cess).
In certain cases, Minimum Alternate Tax (MAT) rates apply as follows:
- For income below INR 1 crore: 15.6% (including surcharge and education cess).
- For income between INR 1 crore and INR 10 crore: 15.91% (including surcharge and education cess).
- For income above INR 10 crore: 16.38% (including surcharge and education cess).
Additional tax requirements include:
- No further tax on profit repatriation.
- Compliance with Indian transfer pricing (TP) regulations, including annual income tax returns, TP documentation, TP certificate, and periodic withholding tax returns.