India: Tax

The Lok Sabha has passed the Taxation & Other Laws (Amendment) Bill, 2026 (‘Amendment Bill’). The said Amendment Bill replaces the Income-tax (Amendment) Ordinance, 2026 which was earlier passed on 5 June 2026 and also proposes other amendments to the Income-tax Act, 2025 (‘the Act’), the most notable amendment being in respect of taxation of unitholders and SPVs of business trusts.

Global Capability Centres in India have evolved from basic support operations into strategic hubs handling high-value functions like R&D, analytics, and procurement. As these centres scale and take on more complex responsibilities, multinational enterprises face heightened tax risks around permanent establishment classification and transfer pricing compliance that require careful structural review and documentation.

For multinational companies with established GCCs in India, profit repatriation is a natural extension of a successful operating model. When approached strategically, it allows businesses to optimize global cash flows while remaining aligned with India's tax and FEMA regulations.

India’s Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) were designed as tax-efficient ways to invest in income-producing assets through a regulated, transparent structure. That promise remains, but three successive legislative reforms between 2023 and 2026 have changed the tax structure for these business trusts and their investors.

India’s abolition of angel tax has removed one significant tax risk from startup fundraising. But valuation, Companies Act, FEMA and legacy tax compliance obligations continue to matter.

Alternative investment funds (“AIFs”) are privately pooled investment vehicles which raise funds and invest in accordance with a defined investment policy for the benefit of the investors. AIFs established and operating within India (except in the Gujarat International Finance Tec-City (“GIFT City”)) are regulated by the Securities and Exchange Board of India (“SEBI”) under the SEBI (Alternative Investment Funds) Regulations, 2012, as amended (“AIF Regulations”), which allow AIFs to be structured as a trust, a limited liability partnership (“LLP”), a company, or a body corporate.

India's Global Capability Centre (GCC) story has changed a great deal in recent years. What began as a way to move routine back-office and support work to India has grown into something far more strategic. GCCs today work on artificial intelligence, cybersecurity, engineering, product development, research and development, finance and analytics and increasingly sit at the heart of their parent companies' global operations.

As global capabilities center transition from basic tasks of IT support to advanced innovative technology hubs characterized by AI model training & use of evidence-based research & development, this blog discusses how such functions must be evaluated for purposes of transfer pricing, issues regarding DEMPE, and documentation gaps that and contribute significantly to disputes.

This quarterly tax update examines critical judicial rulings that will shape international tax planning and M&A structuring in India, including the Delhi High Court's landmark decision on deputation arrangements and the Mumbai Tribunal's denial of loss carry-forward in demergers worth INR 2.4 billion.

Business transfers can fail even after legal closing when operational contracts, tax and stamp-duty treatment, and governance rights have not been dealt with together. The buyer may acquire the business legally but still face disrupted operations, restricted commercial rights or unexpected tax liabilities from the first day.

India’s Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) were designed as tax-efficient ways to invest in income-producing assets through a regulated, transparent structure. That promise remains, but three successive legislative reforms between 2023 and 2026 have changed the tax structure for these business trusts and their investors.

Private equity exits from India have reached record levels, but converting investment value into liquidity requires careful navigation of regulatory frameworks, tax structures, and strategic route selection. How can sponsors optimise exit readiness throughout the investment lifecycle to maximise deal certainty and preserve optionality across strategic sales, IPOs, secondary transactions, and public market sell-downs?