Has any provision been made in the recent budget to encourage non-resident Indians to set up manufacturing facilities in India?
In order to position India as the global hub for electronic system design and manufacturing, a comprehensive programme has been approved by the Government of India for setting up facilities to establish a manufacturing ecosystem in the country. To encourage non-resident Indians to set up electronics manufacturing facilities and provide support services, a simple, certain and low tax regime has been announced on February 1. The proposal envisages a presumptive taxation system whereby 25 per cent of the turnover of the manufacturing unit set up by a NRI will be presumed to be the taxable income of the entity. On this amount, tax would be payable at the rate applicable to the manufacturing unit. Therefore, if the unit is a private limited company, the rate relevant for that assessment year would be applied. At the current rate of 25 per cent, tax would be payable would work out to just 6.25 per cent on the gross turnover or receipts. It would not be necessary to have the accounts audited under the presumptive tax regime. Further, there will not be any possibility of litigation as the calculations are straight forward with no room for any controversy. The new provision is under section 44-BBD of the Income-tax Act which will apply from the financial year beginning on April 1, 2025. A similar presumptive system of taxation has been in operation for the past several decades pertaining to foreign airlines and shipping companies which is widely accepted as a global practice.
My son is a climate scientist who is working in the UK. He has been offered an attractive job by a reputed law firm in India. I am not able to comprehend how a scientist would be useful to a law firm. Can you throw some light? If he accepts the assignment, should he take it up as a full time employee or in a professional capacity?
Indian law firms have started recruiting experts having non-legal backgrounds to meet the growing demands of technology, ESG compliance, project management, etc. This shift reflects the evolving nature of legal services requiring multidisciplinary expertise in order to navigate the complexities of modern business and regulatory environments. Law firms are now required to provide new advisory services to align with growing client requirements. These law firms are paying high remuneration for the requisite expertise as more and more companies are incurring legal costs to ensure compliance. According to a recent study, the top 500 companies in India spent around $6.25 billion during 2023-24. Law firms are also employing chartered accountants and forensic experts for undertaking detailed investigations. AI specialists are being employed to deal with the growing menace of cyber crimes. Certain law firms focus on climate advisory work and therefore employ qualified climate scientists. If your son decides to take up the assignment with an Indian law firm, it would be best to do so in a professional capacity whereby he can claim deduction for all legitimate professional expenses incurred by him in performing his duties. On the other hand, if he takes up a full time job with a law firm, the entire monthly salary earned by him would be liable to tax subject only to the paltry standard deduction.
I am planning to buy a plot of land on the outskirts of a city in South India. I have been informed that it has been classified as non-agricultural. I will be visiting India to finalize the deal. Please let me know what precautions I should take before completing the purchase.
Land disputes are very common and therefore you should ensure that the legal title of the seller from whom you are buying the land is clear. For this purpose, you will need to appoint a lawyer who will examine the historical land records of past years. He will then give you a search report which must show that all property taxes have been paid upto date and there are no financial liabilities of the seller. Further, there should be no encumbrances which the seller had incurred by taking a loan. In case the seller has received a part of the land upon inheritance, the division of land among co-owners must be clearly specified in the lawyer’s report. The lawyer should also inform you whether the land is a freehold one or whether it is taken on lease and, if so, for what period. His certificate must also mention that the seller of the property has not entered into any agreement with a real estate developer. In short, you must ensure that you get a clear land title certificate from the lawyer before you proceed to purchase the plot of land.
2025-02-04T07:14:57Z