India Achieves Record 174 Advanced Pricing Agreements in 2024/25 Financial Year

India’s Central Board of Direct Taxes (CBDT) has announced that it entered into an unprecedented 174 advanced pricing agreements (APAs) with Indian taxpayers during the 2024/25 financial year, marking the highest number of APAs signed in a single year since the programme’s inception. The announcement was made through a press release issued on Monday, March 31.

The APA programme, designed to offer transfer pricing certainty to taxpayers, allows for the advance determination of pricing methods and the arm’s-length price of international transactions for up to five years. Additionally, bilateral APAs provide added protection against both potential and actual double taxation.

According to the CBDT, India has now signed a total of 815 APAs since the programme was introduced in 2012. This includes 615 unilateral APAs, 199 bilateral APAs, and one multilateral APA—the latter being the first of its kind, signed last year. Out of the 174 APAs finalized in 2024/25, 65 were bilateral, making it the highest number of bilateral APAs ever signed in a single year.

“These were a result of mutual agreements with India’s treaty partners, including Australia, Japan, South Korea, The Netherlands, New Zealand, Singapore, the UK, and the US,” the CBDT stated in its release.

The year also saw another milestone, with a record-breaking 34 APAs concluded on a single day in March. The statistics reflect a strong upward trend in India’s APA programme, with 125 APAs signed in the 2023/24 financial year and 95 in 2022/23.

Highlighting the growing impact of the programme, the CBDT emphasized that “the APA programme has significantly contributed to the Government of India’s mission to enhance [the] ease of doing business, particularly for multinational enterprises engaged in extensive cross-border transactions.”

The board also expressed appreciation for the cooperation of taxpayers in making the initiative a success. “[The] CBDT recognises the collaborative spirit of taxpayers and values their role as key stakeholders in the successful implementation of the APA programme,” the release concluded.

By fLEXI tEAM