India

Overview

Last reviewed - 14 May 2020

India, a country in South East Asia, is the seventh-largest country by geographical area, the second-most populous country with over 1.25 billion people, and the most populous democracy in the world. It is bounded by the Indian Ocean to the south, the Arabian Sea to the southwest, and the Bay of Bengal to the southeast. It shares land borders with Pakistan to the west; Bhutan, the People's Republic of China, and Nepal to the northeast; and Bangladesh and Myanmar to the east. India is divided into 28 states and eight union territories, with New Delhi as the capital. The official languages of India are Hindi and English, and the currency is the Indian rupee (INR).

India gained independence in 1947 and is developing into an open-market economy. Economic liberalisation, including reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth rate, estimated at 5% in tax year 2020/21 (tax year begins on 1 April and ends on 31 March of the following year; note that, in India, 'tax year' is referred to as 'financial year' and the year following a 'tax year' is referred to as 'assessment year').

Over the seven decades since independence, the country has achieved self-sufficiency in terms of food and grains. India is now a net exporter of food. Life expectancy has more than doubled, literacy rates have quadrupled, health conditions have improved, and a sizeable middle class has emerged. India is now home to globally recognised companies in pharmaceuticals, automobiles, steel, and information and space technologies.

PwC India provides industry-focused tax and advisory services. The tax practice in India helps enterprises in formulating tax compliant and effective strategies. PwC has offices in Ahmedabad, Bengaluru, Bhopal, Chennai, Delhi NCR, Hyderabad, Kolkata, Mumbai, Pune, and Raipur.

Quick rates and dates

Corporate income tax (CIT) rates
Headline CIT rate (%) Domestic corp.: 25%* if turnover/gross receipts do not exceed INR 4 billion for FY 2017/18; otherwise, 30% (surcharge ranging from 7% to 12% of tax applicable);
Foreign corp.: 40% (surcharge ranging from 2% to 5% of tax applicable);
Additionally, health and education cess at 4% of tax and surcharge.
*Lower tax rate of 22%/15% is also applicable, subject to certain conditions.
Corporate income tax (CIT) due dates
CIT return due date 30 September of succeeding tax year.
30 November of succeeding tax year if the corporation has international transactions with associate affiliates/specified domestic transactions.
CIT final payment due date Before submission of return of income (i.e. 30 September/November as the case may be).
CIT estimated payment due dates Estimated tax is due in quarterly instalments payable before the 15th day of each quarter of tax year (i.e. 15 June [15%], 15 September [45%], 15 December [75%], 15 March [100%]).
Personal income tax (PIT) rates
Headline PIT rate (%) 42.744 (i.e. 30% + 37% surcharge + 4% health and education cess)
Personal income tax (PIT) due dates
PIT return due date 31 July of the tax year.
PIT final payment due date Final income tax payment shall be made on or before the due date of filing of the income tax return.
PIT estimated payment due dates If the tax payable on estimated income for a tax year is likely to exceed INR 10,000, advance tax need to be paid in quarterly instalments payable before 15th day of each quarter of tax year (i.e. 15 June [15%], 15 September [45%], 15 December [75%], 15 March [100%]).
Value-added tax (VAT) rates
Standard VAT rate (%) The rate of GST varies from 5% to 28% depending upon the category of goods and services, the general rate of tax being 18%.
Withholding tax (WHT) rates
WHT rates (%) (Div/Int/Roy) Resident: 10* / 10 / 10;
Non-resident: 20* / 20** / 10
(The above are to be enhanced by surcharge and health and education cess)
* Tax withholding applies on dividends declared and paid by Indian companies to its shareholders on or after 1 April 2020; Prior to 1 April 2020, the company declaring dividend was required to pay Dividend Distribution Tax.
** Special WHT rates apply in certain cases where WHT rate is lower than 20%.
Capital gains tax (CGT) rates
Corporate capital gains tax rate (%) Long-term capital gain: 10 (on sale of equity shares/units of equity oriented funds in excess of INR 100,000); otherwise, 20.

Short-term capital gain: 15 (if securities transaction tax payable). Where no securities transaction tax is paid, normal corporate tax rate applies.

Above rates are to be enhanced by surcharge and health and education cess.
Individual capital gains tax rate (%) See India's individual tax summary for capital gain rates.
Net wealth/worth tax rates
Headline net wealth/worth tax rate (%) NA
Inheritance and gift tax rates
Inheritance tax rate (%) NA
Gift tax rate (%) See India's individual tax summary for gift tax rates.

NA stands for Not Applicable (i.e. the territory does not have the indicated tax or requirement)

NP stands for Not Provided (i.e. the information is not currently provided in this chart)

All information in this chart is up to date as of the 'Last reviewed' date on the corresponding territory Overview page. This chart has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this chart, and, to the extent permitted by law, PwC does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.