Emerging Markets Rates and Currencies Handbook

Tax Summary – India India W/H Tax • For non-residents – • 20% WHT • Under certain tax treaties typically 10%, with further reduction possible on country-by-country basis • Concessional 5% WHT on FCY borrowed upto 30 June 2023 via a loan agreement qualifying as ECB under exchange control regulations, normal rates if FCY borrowed post 1 July 2023. • Nil WHT for borrowing from IFSC units • For residents - 10% WHT • For Non- residents - WHT on gains on derivatives will attract 40% tax subject to eligibility of the tax treaties whereby the WHT can be nil on account of No PE • Nil WHT on gains/ income on non-deliverable forward contracts/ offshore/ OTC derivative instruments entered into with offshore banking unit of IFSC • For residents – nil WHT • Dividend distribution tax replaced (April 2020) byWHT of 10% for residents and 20% for non residents • Under certain tax treaties typically 10%, with further reduction possible on country by country basis • For Non residents Gains on equity will also be subject to tax. The rate depends on multiple criteria i.e. residency, on market/ off market, period of holding etc. Deductibility of interests • Cap on interest deduction to 30% of company’s EBITDA • Excess interest expenditure disallowed in that year can be carried forward for eight years and would be available for set off • Fully deductible • Any interest paid by a taxpayer on capital borrowed for the purposes of the taxpayer’s business or profession is tax deductible without any limit • N/A • N/A Deductibility of FX losses • Fully deductible, if it is in the nature of business income Other Taxes/Duties • N/A • N/A • N/A • N/A • N/A Comments • N/A • N/A • N/A • N/A • N/A Note: Citigroup Inc. and any of its affiliates do not provide accounting, tax, or legal advice. Please seek advice from a relevant licensed advisor Source: Relevant legislation, publicly available sources Country Tax Deductibility and Considerations Inter-Co Debt Offshore Derivatives Equities Bank Loans Offshore Local Borrowing