Orbitax subscribers can now easily follow the latest COVID-19-related tax measures being implemented worldwide. New to Orbitax? Create a free account to access your dashboard and latest tax news.
News Share

The Tax Hub

Daily Tax Newsletter

India-Singapore-United Kingdom-United States

Responsive image

Indian Tribunal Holds Fees for Overseas Marketing Services do Not Constitute FTS under Singapore and UK Tax Treaties

The Kolkata Income Tax Appellate Tribunal recently issued a decision on whether fees paid to overseas subsidiaries for marketing support services constitute fees for technical services (FTS). The case involved Batlivala & Karani Securities Pvt. Ltd. (B&K), an India-based brokerage company providing services for institutional clients.

In the year concerned, B&K paid service fees to its subsidiaries in Singapore and the UK for marketing support services for the expansion of its business overseas. The service fees paid covered the costs of the subsidiaries to provide the services plus a markup, with no tax withheld. In auditing B&K, the assessing officer determined that the service fees constituted FTS, and that tax should have been withheld. As a result, the assessing officer disallowed the deduction of the service fees by B&K, and B&K appealed.

In its decision, the Tribunal sided with B&K. It determined that since the marketing support services did not make available any knowledge, experience, skill, know-how or processes to the Indian taxpayer, the service fees could not be treated as FTS. This determination was based on the definition of FTS in India's tax treaty with the UK and Singapore, as well as the MoU with the U.S. on interpreting Article 12 (Royalties and Fees for Included Services) of the India-U.S. tax treaty, which includes a definition of "included services" that is similar to the Singapore and UK treaty definitions of FTS. Based on this and the fact that that neither the Singapore or UK subsidiaries had a permanent establishment in India, the Tribunal held that no withholding tax was due and the deductions should be allowed.

Powerful Tax Tools


FX Rates

Global FX Rates including Tax Year Average FX Rates and Spot Rates for all Reporting Currencies.


Corporate Tax Rates

Corporate tax rates, surtaxes, and effective tax rates for the current year, as well as historical rates and approved future rates.


Country Analysis

Detailed tax guidance for companies doing business in over 100 countries, including summaries and snapshots of key tax facts and issues.


Cross Border Tax Calculator

Calculate total tax costs and benefits of a cross border transaction including withholding tax, participation exemption and foreign tax credit rules.


Cross Border Tax Rates

Provides Domestic, treaty and EU cross border tax rates for over 5,000 country combinations for 9 different payment streams.



Complete overview of the OECD BEPS Project, including daily BEPS news, country adoption of BEPS measures, and an overview of the 15 BEPS Actions.


Tax Calendar

Customizable calendar tool that tracks corporate income tax, value added tax and transfer pricing obligations by country or entity.


Tax Forms

English translations of key tax forms for over 80 countries, including tax return forms, treaty benefit forms, withholding tax forms, and more.


Worldwide Tax Treaties

Repository including thousands of tax treaties (in English), OECD, UN and US Models, relevant EU Directives, Technical Explanations, and more.


Worldwide Tax Planner

Calculates the worldwide tax cost of what-if scenarios based on legal entity structure, taxable income, and cross border transactions.


Certified Rates Report

Customizable Certified Rates Report providing updated corporate and withholding tax rates at the end of each month for over 100 countries.


Withholding Tax Minimizer

Enables quick calculation of tax costs and benefits of cross border transactions considering all possible transaction combinations and optimal routes.


VAT Rates

Provides value added tax (VAT) rates, goods and services tax (GST) rates and other indirect tax rates for over 100 countries.


NOL Calculator

Country specific calculator to determine how net operating losses can be utilized in carryback and carryforward years.


Transfer Pricing Calculator

Calculates TP ratios under various TP methods and calculates the difference between target ratios and actual ratios.


Individual Income Tax Rates

Individual tax rates for over 100 countries.

Play of the Day

Translate Documents

English translations of key tax forms for over 80 countries, including tax return forms, treaty benefit forms, withholding tax forms, and more.

We’re here to help

We’re here to answer any questions you have about the Orbitax products and services.

Send us a message

Who’s behind Orbitax?

We’re committed to providing high value, low cost tax research and management solutions.

Learn More