Compliance by Branch Offices
RBI Compliance Annual Activity Certificate
Branch offices and liaison offices should file an Annual Activity Certificate (AAC) at the end of each financial year, i.e. March 31. The AAC should be obtained from a qualified Chartered Accountant. A copy of the AAC along with the audited Balance Sheet should also be filed with the designated Category I Bank's AD on or before September 30 of that year. A copy of the same should also be sent to the Directorate General of Income Tax (International Taxation), New Delhi.
In case the annual accounts of the LO/BO are finalized on a date other than March 31, the AAC and audited Balance Sheet should be submitted within six months from the date of preparation of the balance sheet to the designated AD from a Category I Bank.
Registrar of Companies, Compliance
Compliance under Company Law
- Annual Filing
- Periodic Filing
- Changes in Charter documents/Memorandum and Articles or any other instrument that defines the foreign company's constitution.
- Change of address for Registered/Principal offices of the foreign company.
- Change of Directors or Secretary of foreign company.
- Change of Authorized Representative(s) in India and changes in the name or address of such person.
- Change of the principal place of business in India.
Foreign companies should prepare a Balance Sheet and Profit & Loss Account Statement and file a copy with the ROC. If such documents are not in English, a certified translation should also be annexed.
Foreign companies are required to file periodic returns with the ROC in the following events:
The tax treatment of a branch office is different from that of a company registered in India. The present tax rate applicable to a foreign company branch is 42%. Apart from direct tax, a branch of a foreign company should also comply with all prescribed regulatory requirements under Indian Income Tax laws.
On the other hand, a liaison office cannot generate any income in India and is hence not required to pay any taxes. A liaison office should fulfill compliance requirements, including filing Annual Activity Certificate form at the end of each year and any other compliance requirements as applicable from time to time.