16 June 2011
SIR, A PERSON RESIDENT IN INDIA IS HAVING A BRANCH IN CANADA.HE WISHES TO REMIT MONEY FROM INDIA TO CANADA FOR EXPENSES INCURRED BY CANADIAN BRANCH. IS IT POSSIBLE, IF YES , SUGGEST ME THE PROCEDURE TO BE FOLLOWED BY HIM?
16 June 2011
the Act or rules or regulations made or issued thereunder, no person whether resident in India or not, shall make remittance of any asset held in India by him or by any other person:
Provided that the Reserve Bank may, for sufficient reasons, permit any person to make remittance of any asset held in India by him or by any other person.
Permission for remittance of assets in certain cases :-
(1) A person specified in sub-regulation (2) may make remittance of assets through an authorised dealer, to the extent specified in that sub-regulation.
(2) A citizen of foreign state, not being a citizen of Nepal or Bhutan or a person of Indian origin (PIO), who –
(i) has retired from an employment in India, or
(ii) has inherited the assets from a person referred to in sub-section (5) of section 6 of the Act; or
(iii) is a widow resident outside India and has inherited assets of her deceased husband who was an Indian citizen resident in India,
may remit an amount, not exceeding Rs.20 lakhs per calendar year, on production of,
(a) documentary evidence in support of acquisition of assets by the remitter; and
(b) a Tax clearance/no objection certificate from the Income-Tax authority for the remittance:
Provided that for the purpose of arriving at annual ceiling of remittance under the sub-regulation (2), the funds representing sale proceeds of shares and immovable property owned or held by the citizen of foreign state on repatriation basis in accordance with the Foreign Exchange Management (Acquisition and transfer of immovable property in India) Regulations, 2000 and Foreign Exchange Management (Transfer of Indian security by a person resident outside India) Regulations, 2000 made under the Act, shall not be included.
Provided further that where the remittance is made in more than one instalment, the remittance of all instalments shall be made through the same authorised dealer.
(iv) had come to India for studies/training and has completed his studies/training, may remit the balance available in his account, provided such balance represents funds derived out of remittances received from abroad through normal banking channels or rupee proceeds of foreign exchange brought by such person and sold to an authorised dealer or out of stipend/scholarship received from the Government or any Organisation in India.
(3) An authorised dealer in India may, without approval from Reserve Bank, effect remittance of assets made by a person eligible under sub-regulation (2).
Permission to an Indian entity to remit funds in certain cases :-
An entity in India may remit the amount being its contribution towards the provident fund/superannuation/pension fund in respect of the expatriate staff in its employment who are resident in India but not permanently resident therein.
for more info: http://www.rbi.org.in/scripts/BS_ViewMasCirculardetails.aspx?id=5119
16 October 2011
Kindly take care that expenses incurred by Canada Branch are not more than 10% of average turnover of Indian company for last 3 years .
Also deduct TDS on any payments made by Canada Branch requiring TDS deduction u/s 195, as Canada Branch is Indian resident as per Income tax Act.
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