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PAN is short for Permanent Account Number. A PAN card was a necessity until recently and was obtained after obtaining aPAN registration with the Indian Revenue Service. The need to apply for PAN expired as of July 2016. Until the first half of 2016, foreign companies that sent invoices to Indian customers for services had to apply for PAN registration in India. Although it is no longer mandatory to have a PAN card, in some cases it may still be smart to apply for one. For example, if you want to establish yourself in India long term, you need to register with the Indian tax authorities after which you will automatically get a PAN and PAN card.

This is a common complaint from foreign companies doing business in India. It is true (usually) that when sending an invoice for services rendered to an Indian party, the Indian party is required to withhold and remit 10 or 20% withholding tax. Indian service suppliers can offset this again, but it is more difficult for foreign suppliers. You should make proper arrangements in advance with your Indian buyer and his/her accountant to avoid paying TDS.

The Goods and Services Tax (GST) is India's version of VAT. There are five rates, ranging from 0% to 28%, under which 1211 categories of goods and services are divided. Under the GST system, tax is levied at any time value is added to the product and a sale is made. This runs up to the final sale to the customer. You can read how the Goods and Services Tax is levied and whether you have to pay it here.

Transfer Pricing (TP) are internal transfer prices for delivery of goods, services or intellectual property rights within related companies. A transfer pricing policy clarifies where the international company earns its profits and in which countries those profits should be taxed. Indian TP legislation is largely influenced by OECD TP guidelines, but they are adapted to specifically meet the needs of the Indian tax system. In our guide for CFOs with operations in India, we explain the rules you need to comply with in India. Download the free guide here.

The import duties you have to pay depend on your product group (HS code). On average, import duties are 26 to 30%. For alcohol, chocolate, tobacco, dairy products and luxury products such as assembled cars, this is considerably higher. For many medical products, import duties are actually lower. Do you have the Indian government or a 5-star hotel as a customer? Then there are no import duties.

Ja, in de meeste sectoren is dat geen probleem. Bepaalde sectoren kennen beperkingen (maximaal 49% of 24% eigendom door buitenlandse entiteit).