Short Overview of the amendments related to the Safe Harbour

Short Overview of the amendments related to the Safe Harbour Rules for intra-group loans applicable from April 1, 2024.

The CBDT vide its notification no. 104/2023 dated December 19, 2023 introduced significant amendments to the Safe Harbour Rules for intra-group loans applicable from April 1, 2024. The key changes are summarised below:

Changes in Rule 10TA

a) Scope of intra-group loan as provided in Rule 10TA(f) has been widened to include any associated enterprise against only subsidiary companies as specified earlier.

b) Widening of definition of operating expense and income under Rule 10TA(j) and (k) to include income / loss on transfer of assets for which depreciation forms part of the operating expense.

Changes in Rule 10TD

c) Transition from reliance on CRISIL credit ratings to credit ratings assigned by a SEBI registered and RBI accredited credit rating agency for determination of safe harbour for intra-group loans denominated in INR.

d) Transition from reliance on LIBOR to alternative reference rates namely, SOFR (USD), EURIBOR (EUR), SONIA (GBP), TORF (JPY), BBSW (AUD) and SORA (SGD) for determination of safe harbour for intra-group loans denominated in foreign currency.