Although accurate, I suspect this is an unhelpful ttle for this post. Actually, they are two unrelated things linked only because I have had the fun of running communications training programmes in India over recent years. And I thought my recent experiences with India withholding tax might be useful to some.
It always surprises me that so much unhelpful and incorrect advice is given on presentation design and delivery skills. I suspect it comes from the “Give them a few tips” culture. I was running a training session recently and we were examining the use of visual aids, and the sequence which works best for an audience given the way in which our eyes, ears and brains work. It is as many of you may know: deliver the idea you wish to put over, describe what you are going to show your audience and what to look out for, then show the visual aid (and avoid talking over it!)….. and then remove it.
One of my course delegates said that he had recently been on a Consulting Skills course run by the “global University” of a major IT services supplier.The tip they provided for using visual aids (I think in this case flipcharts) was Touch, Turn and Talk. Although I understand that there may be circumstances where this sequence may be used – especially with flipcharts – as a general rule for visual aids, it is entirely the wrong way round. Perhaps it was a “tip” conceived by someone who has been schooled in “Show and Tell” at a tender age.
If you do any work for an Indian company (but are registered elsewhere such as the UK) you will know that the Indian Tax Department levies withholding tax. Up until a couple of years ago this was levied at a rate of a little over 10%. So, you invoiced £8000 and the client paid you £7115.40. The client would also send you a certificate of withholding tax paid. If you are a UK registered acompany, you could offset this amount against your UK Corporation Tax later.
However, this regime changed in 2010 and new rules have been introduced by the India Tax Department which could cause you to lose money. You now need to have a PAN – a Personal Account Number – issued by the India Tax Department. It comes in the form of a credit card sized piece of plastic. If you have a PAN number for your company and can quote this to your client, they will deduct withholding tax at the rate of 10.56% and will also provide a certificate of withholding tax paid – just as before.
But now, if you do not have a PAN number, withholding tax has to be deducted at the rate of 20%. But the real rub is the fact that a certificate of deduction of withholding tax will not be issued if you do not have a PAN. So, no offset against Corporation Tax and you stand to lose 20% of your charged fees.
I did try and work out how to apply for a PAN card, but believe me, it is not easy. And, as I discovered, there are some pitfalls – things that are not included in the instructions provided with the forms on-line. But help is at hand – help that I would strongly urge you to get hold of before applying for a PAN card. In my case I used the services of the NRI Centre based in Hounslow – NRICentre.NET [email@example.com]. For a very modest fee, they provided much needed advice, and then took away all the hassle of dealing with the India Tax Department, including the payment of the PAN card fee.
Getting documents together and having them legally endorsed took a few days. From sending the application to the NRI Centre, it took 5 weeks before I got confirmation of my PAN number (from the NRI Centre) and a further 10 days before the plastic arrived.
So, if you are going to do work in India for an Indian registered company, it would be wise to apply for a PAN card well in advance.