As PhonePe shifts back its domicile from Singapore to India, several other fintechs are also closely tracking the move - potentially looking to replicate it But what is worrying these companies and their investors is PhonePe's massive tax bill of $1.2 billion💵 Tweet added by Madhav Chanchani @madhavchanchani

Madhav Chanchani

2 years

As PhonePe shifts back its domicile from Singapore to India, several other fintechs are also closely tracking the move - potentially looking to replicate it But what is worrying these companies and their investors is PhonePe's massive tax bill of $1.2 billion💵

4

27

335

Madhav Chanchani

@madhavchanchani

2 years

Investors are liable to pay long-term capital gains tax on the move -- even if they haven't cashed out any shares and gains are notional Companies want to move back to India because of multiple reasons - IPO in India will have better valuations to also regulatory issues

1

0

45

Madhav Chanchani

@madhavchanchani

2 years

For fintechs, moving domicile back to India is becoming important This comes as RBI has been hesitant in granting NBFC licenses to these startups due to issues like the origin of capital + clarity on ownership structure More in this scoop by @AditiS90

PhonePe’s India flip comes with a billion-dollar tax googly

Phonepe is among the first unicorns shifting its registration from overseas to India. More startups, especially in the fintech space, are also likely to follow. But for their shareholders, a big tax...

the-captable.com

1

45

Sree Sivanandan

@SreeSivanandan

2 years

@madhavchanchani @kannanharihar

0

1

Pratik Manani

@PratikManani90

2 years

@madhavchanchani Most start-ups make this mistake of disregarding long-term perspective while deciding their business model. In order to attract the higher valuation in the initial phase of business they usually park IP in a country where the major investors are located (US/Canada).

0

Pratik Manani

@PratikManani90

2 years

@madhavchanchani However, by doing this they ignore the various tax and transfer pricing implications of moving IP from one country to another country at a later stage when the IP is matured. Read my article on common mistakes that MNEs must avoid.

0

Replies