PoEM rules will not apply to companies with sales below Rs 50 cr

PoEM to determine tax liability of foreign cos managed from India but don't pay tax domestically

The tax department has reiterated that the Place of Effective Management (PoEM) rules that require foreign firms to pay taxes in India if the effective control is within the country will not apply to companies with a turnover of Rs 50 crore or less in a financial year.

Last month, the tax department had come out with the long-awaited PoEM rules that will require foreign companies in India and Indian firms with overseas subsidiaries to pay local taxes if their businesses were effectively controlled by Indians.

That time, the rules did not set a threshold over which the rules will apply. However,