This e-newsletter gives you an overview of international corporate tax developments being reported globally by KPMG firms in the Asia Pacific region between 1 November and 30 November 2012.
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Tax area concerned |
Relevant date/case Reference |
Description of measures and publication link
(Considerations in italic where necessary) |
| Burma/Myanmar |
| Other |
Tax facts |
November 2012 |
KPMG in Myanmar published a report Investing in Myanmar which provides an overview of the market in Myanmar (also referred to as Burma).
Read more |
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| Cambodia |
| Tax legislation adopted and regulatory update |
Reporting requirements |
October 2012 |
Cambodia’s Ministry of Economy and Finance, National Accounting Council) issued guidance in October 2012 that establishes the rules for entities that must prepared financial statements.
Read more |
| December 2012 |
As the end of 2012 approaches, taxpayers with business operations in Cambodia need to be aware of their annual tax and corporate compliance requirements.
Read more |
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| China |
| Tax legislation adopted and regulatory update |
Corporate income tax |
November 2012 |
A decree issued by China’s Ministry of Commerce clarifies the rules concerning how foreign investors may use an equity interest in a company as a capital injection in a foreign investment enterprise.
Read more |
| Personal income tax |
November 2012 |
Foreign workers who hold Chinese Government-issued permits and are permanent residents, may be entitled to certain benefits.
Read more |
| |
2012 year-end tax checklist |
November 2012 |
KPMG in China prepared a report outlining a series of important corporate income tax and indirect tax regulations which may affect the filings of tax returns and financial statements by taxpayers doing business in China.
Read More |
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| Hong Kong |
| Tax legislation adopted and regulatory update |
Corporate income tax |
October 2012 |
The Hong Kong Government released the consultation conclusions with respect to proposed amendments to the tax laws (Inland Revenue Ordinance and Stamp Duty Ordinance) to provide a taxation framework that ‘levels the playing field’ between Islamic bonds (Sukuk) and conventional bonds.
Read more |
| Treaties |
DTT |
1 January 2013/ 1 April 2013 |
The ratification processes concerning an income tax treaty between Hong Kong and Switzerland have been completed. The treaty will enter into force in Switzerland—(1) with respect to taxes withheld at source on amounts paid or credited on or after 1 January 2013, and (2) with respect to other taxes, for tax years beginning on or after 1 January 2013 (and in Hong Kong—for any year of assessment) beginning on or after 1 April 2013.
Read more |
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| India |
| Tax legislation adopted and regulatory update |
Tax accounting |
26 November 2012 |
The Ministry of Finance issued a final report to create accounting standards under the Income-tax Act, 1961. The report contains the final recommendations and drafts of 14 tax accounting standards that, if finalized, would apply to the computation of taxable income. Comments were due by 26 November 2012.
Read more |
| Reporting requirements |
November 2012 |
The Director General of Income-tax announced an extension of the time for sending ITR-V forms relating to income tax returns filed electronically (without attesting a digital signature certificate) for the Assessment Year 2010-11 (filed during the period 1 April 2011 to 31 March 2012) and 2011-12 (filed on or after 1 April 2011).
Read more |
| Employees |
November 2012 |
The Indian Government has issued an updated list of frequently asked questions on international workers and India’s provident funds plans.
Read more |
| Treaties |
DTT |
November 2012 |
A Protocol to the India-United Kingdom income tax treaty amends various provisions of the 1993 treaty, including provisions concerning partnerships, a limitation-on-benefits clause, and the taxation of dividends.
Read more |
| Social security treaty |
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India and Sweden sign social security agreement: Representatives of the governments of India and Sweden signed a social security agreement, which provides the following benefits: (1) exemption from social security contribution in the host country (2) export of benefits and (3) totalization of contributory periods.
Read More |
| Administrative and case law |
Corporate income tax |
Hindustan Lever Ltd. |
The Madras High Court held that common head office administrative expenditures were necessary for running the business and thus cannot be apportioned to the individual units before computing deductions.
Read more |
| November 2012 |
Case law has been published with respect to the following subjects:
| • |
amounts realized on transfer of carbon credits are capital receipts, but because there is no element of profit, they are not taxable |
| • |
tests for determining whether income from sale of shares constitutes capital gains or business income |
| • |
tax paid by the employer on behalf of employees, being a non-monetary perquisite, qualifies for exemption from multiple gross-up. |
Read more |
| November 2012 |
Case law has been published with respect to the following subjects:
| • |
No interest liability for deferment of advance tax when tax is refunded |
| • |
Non-compete fees are not considered revenue expenditure and are not eligible for depreciation. |
Read more |
| Euro RSCG Worldwide Inc |
Case law has been published with respect to coordination fees related to interface service, collected by U.S. entity having no permanent establishment in India.
Read More |
| Clearwater Technology Services (P) Ltd |
Case law has been published with respect to ’voice charges’ paid to a foreign telecom company.
Read More |
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| Korea |
| Tax legislation adopted and regulatory update |
Personal income tax |
November 2012 |
The Korean Tax authorities focus on offshore hidden assets.
Read more |
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| New Zealand |
| Tax legislation adopted and regulatory update |
Corporate income tax |
November 2012 |
New Zealand’s Inland Revenue officials released a discussion paper outlining various options to impose tax on certain ‘employee expenditure payments’.
Read more |
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| Sri Lanka |
| Proposed legislation |
Budget |
2013 |
Tax proposals presented to Sri Lanka’s Parliament in the 2013 budget on 8 November 2012 includes incentives, income tax ‘holidays’ and VAT updates.
Read more |
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| Vietnam |
| Tax legislation adopted and regulatory update |
Corporate income tax |
November 2012 |
Recent corporate income tax guidance in Vietnam concerns:
| • |
the deductibility of expenses incurred for online advertising services |
| • |
the tax implications of interest-free loans provided by one enterprise to another enterprise |
| • |
when a foreign contractor subcontracts part of its work to a Vietnamese or foreign subcontractor and if the subcontracted work is not clearly set forth in the master contract, the value of the subcontracted amount is not deductible in computing the taxable turnover of the foreign contractor |
| • |
other recent guidance concerns value added tax (VAT) |
Read more |
| Proposed legislation |
Budget |
July 2013 |
Tax legislation pending enactment in Vietnam includes tax administrative and procedure provisions and individual income tax measures.
Read more |
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