印度外国证券投资（FPI）的税务影响与合规要求

Foreign Portfolio Investment (FPI) sounds similar to Foreign Direct Investment(FDI), however, they both have a fundamental difference of intent. Considering the developing Indian Economy and growth, India has become a point of attraction for investment across the globe. In line with the Indian economy, the progressive Indian Share market is alluring not only Indian Investors but also global Investors to invest their funds in India to get better returns.

As per reports, FPI Investment in India in equities has reached INR 1.16 Lakhs Crores by the first week of July itself. However, Such a substantive amount of investment requires the investors to be very vigilant about the legal Compliances applicable in India for approval and taxes.

This article gives an overview of Foreign Portfolio Investment and discusses the tax implications and compliances applicable thereon in India:

1. What is Foreign Portfolio Investment?

• As the name depicts, Foreign Portfolio Investments allow investors to form an investment portfolio in a foreign country. Investment can be made in Equity shares, Mutual funds, bonds, Fixed Deposits, or any other permitted security.
• Unlike Foreign Direct Investments, Investors do not intend to get control of the entity. Rather such investments are meant for handsome returns.
• Investors are willing to take higher risks by investing in securities of other countries to get higher returns.

Read Also: Input tax credit of rejected refund amount can be taken manually by the taxpayer if not recredit by tax authorities

2. Regulation of Foreign Portfolio Investments?

• Foreign Portfolio Investment is regulated by the Security Exchange Board of India through the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014 (“FPI Regulations”).
• FPI regulations define the criteria for registration of FPI, permissible securities for investment, reporting requirements, etc.
• As per the FPI Regulations, a Foreign Portfolio Investment is required to satisfy the eligibility conditions given under Regulation 4 and to register itself as an FPI with a Designated Depository Participant (DDP). Upon receipt of the application from FPI, the Designated Depositary Participant shall grant the certificate of registration.
• Further, an FPI is allowed to invest only in lists of securities specified under Regulation 20 of the regulations. 

3. Permitted Investments in India

As per Regulation 20 of FPI regulations, an FPI is permitted to Invest in the following securities:

1. shares, debentures, and warrants issued by a body corporate; listed or to be listed on a recognized stock exchange in India;
2. units of schemes launched by mutual funds under Chapters V, VI - A, and  VI - B of the Securities and Exchange Board of India
3. Units of scheme floated by a Collective Investment Scheme by the SEBI (Collective Investment Scheme) Regulations, 1999
4. Derivatives traded on recognized stock exchange
5. Units of real estate investment trusts, infrastructure investment trusts, and units of category III Alternative Investment funds registered with SEBI
6. Indian Depository receipts
7. Any debt securities or other instruments as permitted by RBI for FPI to invest from time to time
8. Any other instrument as specified by SEBI from time to time.

4. Tax Implications and Compliances on FPI:

4.1 Obtain Permanent Account Number (PAN) in India

• The FPI is required to obtain a PAN in India.
• The Application for allotment of PAN is automatically generated and sent by the Digital Depository Participant  (DDP) once registration of FPI is completed through the Common Application Form.
• Following is the process flow of generation of PAN:

4.2 Tax Framework for FPI

• Funds of FPI are invested in India to obtain handsome returns. Such investment is made in Securities (listed or unlisted), Fixed Deposits, bonds, etc.

1. Capital Gains

• Any security (whether listed or unlisted) held by the FPI is considered a capital asset and profit or loss arising from the transfer of such capital asset shall be taxed as capital gains.
• Such capital gain shall be taxed as Long Term Capital Gain or Short Term Capital gain depending on the period of holding of capital asset.
• Capital assets shall be classified as short-term capital assets or long-term capital assets in the following manner:

However, as per Finance Act, 2024, the following shall be the criteria for the classification of capital assets as long-term capital assets or short-term capital assets with effect from 23rd July 2024:

• As per Section 115AD of the Income Tax Act, Any capital gain arising from the transfer of the above-mentioned capital assets shall be taxed at the following rates depending on the nature of the capital asset:

As per the Finance Act, 2024, Any capital gain arising from the transfer of the above-mentioned capital assets shall be taxed at the following rates depending on the nature of the capital asset with effect from 23rd July 2024:

2. 其他来源收入
   • 外国证券投资机构（FPI）通过投资获得的任何其他收入（如利息、股息收入等）均应作为“其他来源收入”征税。
   • 根据《所得税法》第115AD条，FPI收到的任何收入均应按以下税率征税

• 此类收入应按适用税率扣缴所得税（TDS）。

c. 附加税与附加费

• 除上述所得税外，还需缴纳适用的附加费（税率为2%至37%）以及健康与教育附加税（4%）。

d. 避免双重征税协定

• 上述税率受相关国家与印度签署的《避免双重征税协定》（DTAA）的适用性约束。
• FPI有权申请享受相关国家的DTAA优惠待遇。
• 若DTAA的条款对FPI更为有利，则该条款的效力优先于印度国内税法。

4.3 向FPI付款时的TDS扣缴

• 根据1961年《所得税法》，付款人在向收款人付款时，须根据收入性质扣除特定比例的金额作为TDS。例如，利息收入扣缴10%，股息收入扣缴10%，不动产销售扣缴1%等。
• 因此，FPI收到的利息和股息收入为扣除适用税率的TDS后的净额。不过，FPI可在财政年度结束后申报所得税时申请退还或抵扣此类TDS。

4.4 资金汇出印度前的纳税义务

• FPI须在以下日期中较早者之前就上述收入缴纳税款：
  • 每季度缴纳预缴税；
  • 资金汇出印度之前

4.5 所得税申报

• FPI须在适用的截止日期（即7月31日、10月31日或11月30日）前申报所得税。
• 如适用，FPI须根据《所得税法》的规定完成审计。
• 此外，若FPI申请享受DTAA优惠，则须在申报所得税前提交10F表格。

5. Conclusion

印度经济正吸引全球外国投资者投资并获取丰厚回报。然而，在印度赚取的收入须在印度缴纳所得税。因此，FPI需要就其投资（如利息、股息、资本利得等）在印度可能产生的税务责任，以及在印度需要提交的表格，寻求专业意见。此外，FPI只有在获得印度指定专业人士出具的税务清算证明后，方可将资金汇出印度。