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IFSC Units

Competitive Tax Regime to be replaced entirely with below details

NIL TAX

  • Security Transaction Tax(STT)
  • Commodity Transaction Tax(CTT)
  • Dividend Distribution Tax(DDT)
  • Long Term Capital Gain(LTCG)
  • Short Term Capital Gain(STCG)
 

Particulars

Units in IFSC

Investors

Income-tax

  • 100% tax exemption for 10 consecutive years out of 15 years

 

  • MAT / AMT @ 9% of book profits applies to Company / others setup as a unit in IFSC. MAT not applicable to companies in IFSC opting for new tax regime

 

  • From 01 April 2020, dividend income distributed by Company in IFSC to be taxed in the hands of the shareholder.

  Interest income paid to non-residents

  • Monies lent to IFSC units not taxable
  • Long Term Bonds & Rupee Denominated Bonds listed on IFSC exchanges taxable at lower rate of 4%

 

  • Transfer of specified securities listed on IFSC exchanges by a non-resident or Category III AIF located in IFSC not treated as transfer - Gains accruing not chargeable to tax in India
  • Specified securities include Bond, GDR, Foreign currency denominated bond, Rupee-denominated bond of an Indian company, Derivatives, Unit of a Mutual Fund, Unit of a business trust, Unit of Alternative Investment Fund and Foreign currency denominated equity share of a company

Goods and Services Tax

  • No GST on services –
    • received by unit in IFSC
    • provided to IFSC / SEZ units or Offshore clients
  • GST applicable on services provided to DTA
  • No GST on transactions carried out in IFSC exchanges

Other taxes duties

  • State Subsidies – Lease rental, PF contribution, electricity & charges
  • Exemption from STT, CTT, stamp duty in respect of transactions carried out on IFSC exchanges