EY Moves Supreme Court Over Tax on US Employees Seconded to India
What Happened
Ernst & Young (EY) has approached the Supreme Court challenging a Delhi High Court ruling that payments made by EY's Indian entities to EY US for employees seconded to India should be taxed as Fees for Technical Services (FTS) rather than simple salary reimbursements. The dispute covers assessment years 2018-19 to 2022-23 and relates to employees who worked in India but remained on EY US payrolls.
Key Takeaways
The case could have far-reaching implications for multinational companies, global capability centres, technology firms and consulting businesses that frequently transfer employees to India. A Supreme Court ruling could determine whether such cross-border employee-cost reimbursements attract tax in India.