Enhancing a stakeholder value is a fundamental concept, which drives every management
effort in the modern business environment. Progressive and bottom-line focused managements
have realized that taxes should be viewed as a dynamic item of cost, rather than
a passive charge on profits.
Indeed, an effective tax-cost management provides a distinct competitive advantage.
This requires the application of appropriate tax strategies proactively identified
and surgically implemented.
Lunawat & Co. assists businesses, organisations and individuals with tax strategy,
planning and compliance, whilst also delivering a wide range of business advisory
services. We have developed a total tax management capability, which encompasses
the entire spectrum of corporate and personal direct taxes.
Cross Border Taxation
In today’s constantly changing global scenario, capital is always in search of lucrative
opportunities and businesses are always aspiring to convert their potentials into
capabilities. With liberalization playing a key role in Indian policies, it has
led to a multitude of multinational companies entering India. Simultaneously Indian
companies have established their presence in global markets.
With the encouragement of foreign direct investment (FDI) inflows into India there
has been a liberalization of the Indian taxation scheme, the Government of India
has come forward with ways to ensure that non-residents abroad make investments
in India which is imperative for the long term growth of the economy. Special tax
provisions are enacted in the statue to encourage the foreign investment through
special tax concession and incentives.
This interplay of domestic and international taxes incident on companies and individuals
often results in complex situations. Converging on an optimum solution requires
taking a holistic view on the “total” tax impact rather than a country specific
Double Tax Avoidance Advisory
Today all the businesses are continually challenged to manage the impact of multiple
and ever-changing tax jurisdictions. The United Nations, the WTO and the developed
nations of the world have all propagated free trade across all geographical barriers
and the enhancement of economic development across all frontiers. The joint policy
statements made by the heads of the Government of India and the various foreign
countries encourage and emphasize the need for transparent cross border transactions.
For this purpose the importance of double tax avoidance agreements (DTAA) has become
utmost to prevent and mitigate the hardship that can be faced by individuals and
companies alike by having to pay taxes in more than one jurisdiction globally. Cross
border transactions help in strengthening and enlarging the scope of financial and
non-financial activities leading to the achievement of targets of overall growth
Our endeavor is to advise our clients through all the stages of the cross border
transactions to mitigate the hardship of double taxation by advising on the incidence
of tax based on the nature of the income and expenditure incurred keeping as per
the provisions of the Indian Tax laws and the provisions of the double tax avoidance
agreements, withholding tax issues and the related compliances.
As multinationals search for more efficient ways to compete in the global market,
cross-border transactions between related companies are increasing in number and
complexity. There is a significant increase in disputes globally as more and more
tax authorities attempt to enforce their transfer pricing rules aggressively.
The explosive growth in world trade in recent years, and the resulting increase
in cross – border transactions between related parties, has catapulted transfer
pricing to the forefront of important international tax issues. MNC’s of all sizes
are finding their transfer pricing practices under increased scrutiny by tax authorities.
There are extensive Transfer pricing regulations in place in India according to
which an arm’s length standard is the frame of reference. Fiscal authorities are
policing multinational’s transfer pricing policies aggressively in an attempt to
protect their tax base from erosion.
Lunawat & Co. help the clients develop the appropriate transfer pricing strategy
balances opportunity and risk management, weighing effective tax-rate optimizations
against fiscal-authority challenges, judicial precedents and the costs of compliance.
We help clients ensure that all compliances in India are met and issues under litigation
Taxation Litigation Services
Tax litigation in India requires a comprehensive approach with the back-up of a
sound legal team and tactful handling at appellate fora. The focus of tax assessments
is gradually shifting from micro issues (such as, procedural disallowances) to issue
based and concept based reviews. Given the legal labyrinth that taxpayers often
face, a judicious cost-benefit analysis is imperative in deciding which issues are
worthwhile to litigate and on which issues it is more viable to concede. We, with
our experience and in-depth knowledge help in making this decision. Complicated
direct tax litigation at all levels of the Income tax Authorities is our forte.
We have both the experience and the acumen to represent clients through tax assessments
before the tax department including the international tax department assessing foreign
entities to tax in India. We also represent clients in transfer pricing assessments
before the Transfer Pricing Department and in appellate forums such as Income Tax
Appellant Tribunal. We help in mitigating hardship and offer intelligent tax advice
in a result oriented manner.
Corporate Taxation Advisory
Corporate taxation is an essential aspect of doing business in India and its importance
cannot be undermined. The Indian government has gradually reduced corporate tax
rates. The emphasis is now shifting towards enforcing compliance and expanding the
tax base with e-governance and digitisation gaining importance. Taxation is also
used as a tool to promote investments in identified industry sectors, thereby spurring
overall economic growth. As such, understanding the impact of developments in tax
and regulatory aspects and strategically using them to the benefit of Indian business
activities is becoming increasingly important.
Sound business decisions need to be backed by the right tax advice. Today’s dynamic
environment has led to fierce competition. Corporate entities have realized the
importance of taxation and its associated cost with efforts to reduce the tax incidence
to enable them to provide the much-needed edge over competitors and meet challenges
in a dynamic business environment.
Corporate tax consultancy, provided by Lunawat forms an integral part of the commercially
viable business decisions minimizing the cost burden. We adopt a “result oriented
approach” which is flexible and emphasizes delivery and value.
Direct Taxation Advisory
India’s dynamic environment has led to fierce competition. Not only corporate entities
but individuals, HUFs, Partnership Firms, LLPs, etc have realized the importance
of taxation and its associated cost with efforts to reduce the tax incidence to
enable them to provide the much-needed edge over competitors and meet challenges
in a dynamic business environment.
Tax consultancy, provided by Lunawat forms an integral part of the commercially
viable business decisions minimizing the cost burden. We adopt a “result oriented
approach” which is flexible and emphasizes delivery and value as per the client’s
The tax authorities keep abreast with the growing complexities and sophistication
of business transactions and have increased the compliance burden with the advent
of technological advancements in the last few years. In order to help our clients
keep themselves intune with the frequently changing compliances our team offers
solutions in an efficient use of technology in a timely and effective manner.
Indirect Taxation Advisory
Indirect taxes pervade every area of a company’s business. Their impact on material
and product costs, cash flow, profitability and, ultimately, on shareholder value
is an important element to stay ahead in competition
Despite the various reforms carried out in the past few years, the prevailing Indirect
tax regime in India is still in a state of evolution. The system is quite complex,
with multi-layered levies both at the Federal and State level. The Federal government
levies tax on goods at the point of import (Customs duty), manufacture (Excise duty),
inter-state sales (Central sales tax or CST), and on provision of services (Service
tax). The states, on the other hand, have been vested with powers to levy tax on
sale of goods within the state (Value Added Tax or VAT), and on the entry of goods
into the state (Entry tax), under the respective state laws.
The existing regime requires businesses to undertake careful upfront analysis of
the tax costs involved in a transaction¸ ensure adequate backup documentation to
support their tax positions and constantly explore opportunities for tax optimization.
Further, as India is committed to move towards uniform Goods and Services Tax (GST)
regime, this needs to be factored in any significant tax approach developed at present.
Our indirect tax professionals with their wide-ranging experience and in-depth knowledge
help clients in all of these aspects. Lunawat provide advisory services in respect
of the state level Value Added Tax (VAT)/Sales tax, Service tax, and Excise duties
and Foreign Trade Policy-related matters. This includes services in relation to
setting up a green field venture including review of tax assumptions and analysis
of tax exemptions/concessions which could be relevant for the project and tax modelling
involving analysis of tax costs and credits impacting the business models.
Further, an indirect tax diagnostic review or health check is a broad-based package
offered to our clients. This review helps identify areas of potential tax exposure
and tap opportunities for tax savings.
VAT / GST
VAT, GST, Sales & Use and other similar taxes are broadly based on transactions,
and liability will arise regardless of profitability. Because most countries impose
these taxes, most transactions are affected. Lunawat & Co helps its clients with
timely planning and the application of technology-based compliance management solutions.
This helps clients reduce costs, minimize risk and at the same time increase confidence
that nothing has been missed. Lunawat & Co has specialised professionals who apart
from conducting VAT audits, provide advisory services and a full spectrum of highly
efficient outsourcing and co-sourcing solutions.
The role of service sector in the Indian economy is quite significant. As Service
Tax is fast emerging as an important tool of revenue collection for the Central
Government, so have the complexities with it. It has become a buzzword in the taxation
laws and envisaged as the tax of the future.
By the Finance Act, 2012, the central Government has changed the taxation of services,
where as the earlier, the service tax was levied by adopting “Selective approach”
and only specified services were taxed where as now, the Government has adopted
the “Comprehensive approach” to tax services, under which all services would be
taxable unless any of the services is specifically excluded / exempted. The specific
exclusion has been made by preparing a list of negative list of services, on which
services tax shall not be imposed.
Taxes may not be totally avoidable, but upfront tax planning provided by us, in
parallel with the decision making process helps our client attain the desired results.
Our professionals are guided by a single, strong underlying philosophy - "helping
our clients attain their business objectives".
Lunawat & Co. has specialised professionals who take a risk-based approach to service
tax audit with a view to help clients to comply with the service tax laws. We go
beyond traditional fundamentals and add tangible value. We also provide advisory
services and a full spectrum of highly efficient outsourcing and co-sourcing solutions
for service tax.
Strategic Business Decisions
Businesses today are evolving organically and in-organically through Mergers, De-mergers,
Acquisitions, Divestures, Sales, etc achieved through both local and transnational
Our approach involves competitive preparedness for a smooth transition from an era
of regulation and protection to the free trade globalized market of the next millennium,
based on a credible track record, to strengthen and nurture core capabilities with
a view to attain and sustain a leadership position in the market, aim at specialization,
which may involve getting out of investments that are non-core and concentrating
on the core competencies of the corporate and allied group companies, restructuring
to acquire resources and capabilities required to compete effectively in the revamped
dynamic economic environment, a recognition of the fact that only a few players
dominate each segment of the market and therefore to restructure/reconstruct a business
to be in line with the global trends, restructuring to facilitate joint ventures
The tax implication of such strategic business decisions for growth, expansion etc.
has to be carefully studied and an efficacious model evolved so that optimum tax
benefits accrue to one and all. Our team would review the tax incidence pre and
post the strategic business decision as one of the important determinants of the
value of the deal. In the exercise of restructuring of companies under the same
group, a tax consideration is one of the ‘make or break’ issues.
Despite the radical changes both the local and global markets have gone through
over the last decades, family companies still dominate the global economy: Not only
are 80 percent of companies worldwide family-owned, they are also to a large extent
still managed by members of the founding family. Not surprisingly, India is no exception.
The fast-changing business backdrop has also made succession planning – traditionally
a difficult issue for family businesses – more crucial than ever. The liberalization
of the Indian economy has unleashed globally competitive forces that are likely
to reshape the business landscape. Those Indian family run and managed enterprises
that have been extremely successful in the past will do well to recognize the importance
of market forces and proactively implement action plans to ensure the future survival
and growth of their organizations.
We at Lunawat & Co. understand this crucial need of traditional family owned businesses
for succession planning ensuring tax efficiency.
Tax Review (Due Diligence)
Due Diligence is the analysis and appraisal of an entity in preparation for establishing
a relationship with another entity, which involves business risk. The due diligence
investigation is normally carried out with the knowledge and co-operation of the
management of the entity being investigated.
The analysis of various taxes is one of the most complex areas that are encountered
during an investigation. We provide expert tax advice through a highly qualified
team which has in-depth knowledge, of the entity’s industry and of the tax nuances
faced by it.
We also undertake assignments for investigations mandated by the departments like
Service Tax Department, VAT department, Investigation Wing (Crime Police), etc.