sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
News Headlines »
 Know all about how to file ITR FY 2017-18
 Government extends sale of pre-GST goods with stickers of revised price till July 31
 All 7 ITR forms for assessment year 2018-19 activated for e-filing: Income Tax Department
 Check if new salary structure is income tax efficient
 GST refund drive extended till June 16
 5 income tax returns filing mistakes you must avoid
 Your complete guide to file income tax return
 Input Tax Credit refund drive till June 14
 File Your Income Tax Return for FY 2017-18 Immediately, Know Why
 Which ITR form to file if income is in dollars?
 5 investment lessons to maximize returns; here is all you need to know

MNC's fee income comes under tax net
January, 10th 2007

In a judgment which could have a bearing on the activities of multinational companies in India, the Authority for Advance Ruling (AAR) has decided that the International Hotel Licensing Company, which markets the Marriott brand, will have to pay tax on fee income received from its Indian partner.

The company's Luxembourg-based parent International Hotel Licensing Company Investments argued that the income earned by its subsidiary is the result of its global advertising, marketing and sales programme and it is not liable to pay tax in India.

In 2005, different Marriott group entities entered into various agreements with Unitech Hospitality, an Indian company, for a hotel in Noida in Uttar Pradesh.

In September 2005, International Hotel Licensing entered into an international marketing programme participation agreement' with the Unitech group. The agreement provides that overseas marketing and business promotion (co-ordinating global marketing activities) of Marriott will be carried out by International Hotel Licensing which will get an annual contribution of 1.5% of the gross revenues of the hotel and 3.4% of members gross room revenues.

Considering that International Hotel Licensing is getting a fixed revenue from Unitech and the the agreement is valid for 25 years (with further extension of 10 years), AAR has ruled that a business connection is established between Unitech and International Hotel Licensing.

Since there is no double taxation avoidance agreement between India and Grand Duchy of Luxemborg, the tax liability of International Hotel Licensing is decided as per Indian income tax laws.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - About Us

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions