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Australia

• An indirect share transfer involving an Australian company that holds Australian land or mining interests may be subject to capital gains tax and/or landholder duty.
• Capital gains tax would typically apply if more than 50 percent of the foreign company’s assets (by market value) are land and mining interests in Australia.
• Landholder duty can apply where the company holds Australian land or mining interests that exceed certain value thresholds.

• While there is no established guidance, the re-domiciliation of a foreign holding company (i.e., changes jurisdiction without changing its legal identity) is unlikely to trigger a taxable indirect transfer under Australian law, as long as there is no change in ownership of the Australian company’s shares.

India

• The Indian indirect transfer tax would be triggered if a foreign company’s share or entity’s interest is deemed to derive its value substantially from the assets (whether tangible or intangible) located in India. This means that, if on the specified date, the value of the Indian assets:
  • Exceeds the amount of USD 1.15 million (INR 100 million); and
  • Represents at least 50 percent of the value of all the assets owned by the company or entity; where value of an asset means the fair market value of such asset on the specified date without reduction of liabilities, if any, in respect of the asset.
• Where the foreign company or entity derives substantial value from Indian assets, the purchaser/buyer should withhold Indian capital gains taxes on behalf of the seller at the time of acquisition of the foreign company or entity.
• In addition to the above withholding obligation, the buyer, seller, and the Indian company through which the foreign company or entity being sold derives substantial value, should also undertake requisite filings and other compliances in accordance with the Indian income tax law.

• The Indian Income tax law is silent and contains no specific provisions governing the tax treatment of a foreign company that re-domiciles to another offshore jurisdiction.
• While re-domiciliation may generally not be treated as a taxable transfer in India (depending on the specific facts) and typically does not trigger indirect transfer provisions, the Indian tax implications of such a re-domiciliation will depend on several factors (primarily whether it entails a transfer or not), including:
  • Whether the existing share capital remains in place or is extinguished and replaced by new shares under the laws of the destination jurisdiction;
  • Whether new share certificates are issued or existing ones continue to be valid;
  • The interaction of domestic laws in both jurisdictions and any applicable bilateral tax‐treaty provisions;
  • The applicability of India’s General Anti-Avoidance Rules (GAAR); and
  • The applicability of treaty abuse provisions like principal purpose test, limitation of benefit clause, etc.
• A detailed, fact-specific, case-by-case analysis should be performed to determine whether the re-domiciliation constitutes a taxable transfer in India and, if so, to identify any resulting tax consequences arising from India indirect transfer. 

Indonesia

• If a foreign shareholder sells or transfers shares in a conduit or special purpose company that is resident in a tax haven jurisdiction and holds, directly or indirectly, a special relationship (i.e., 25 percent or more shareholding or control) with an Indonesian company, the transaction may be recharacterized as a direct sale or transfer of the Indonesian company.
• In such case, the transaction may be taxed at a rate of 5 percent on the gross purchase price or transfer value, regardless of whether the sale results in a gain or loss.

• While there is no established guidance, the re-domiciliation of a conduit or special purpose company that is resident in a tax haven jurisdiction (i.e., changes jurisdiction without changing its legal identity and thus not constituting a legal liquidation), should not trigger a taxable indirect transfer under Indonesian law, as there is no change in legal ownership of the tax haven company’s shares.

Japan

• Japan does not have a general rule for taxing indirect share transfers. However, if the foreign entity being transferred is a real estate-rich company, i.e., more than 50 percent of its asset value is derived (directly or indirectly) from Japanese real estate, and the seller meets certain ownership thresholds (e.g., 5 percent for listed and 2 percent for unlisted), the gain may be taxed in Japan.
• For foreign corporation sellers, the tax rate in general is 23.2 percent. For nonresident individuals, it is 15.315 percent (i.e., only national tax applies if there is no permanent establishment, but the rates can vary depending on certain parameters). Certain tax treaties may exempt nonresidents from capital gains taxation.

• While there is no established guidance, the re-domiciliation of a foreign holding company (i.e., changes jurisdiction without changing legal identity) is unlikely to trigger a taxable transfer under Japanese law, as there is no change in legal ownership of the Japanese shares.

Malaysia

• Effective from 1 January 2024, Malaysia has introduced Capital Gains Tax (CGT) which applies to the disposal of capital assets by local and foreign companies.
• CGT may apply in the event of an indirect transfer of unlisted shares in a Malaysian company if the Malaysian company is a “land-rich company” (i.e., at least 75 percent of the company’s total tangible assets come from real property in Malaysia). Where the Malaysian company is a land-rich company in Malaysia, it follows that the shares of its immediate holding company and above may also fall within the ambit of “Section 15C shares”[4] which would be subject to CGT in Malaysia.
• CGT is imposed at 10 percent on gains from the disposal.

• While there is no established guidance, the re-domiciliation of a foreign holding company (i.e., changes jurisdiction without changing legal identity) is unlikely to trigger a taxable transfer under Malaysian law, as there is no change in legal ownership of the Malaysian shares.

South Korea

• Although the Korea Corporate Income Tax Law (CITL) does not provide explicit guidance on indirect share transfer at the foreign parent’s level, such a change has not generally been regarded as a taxable event. However, the Korean tax authorities have recently taken a more aggressive interpretive stance on indirect share transfers.
• In a 2024 case, where a Singaporean company indirectly held Korean shares through a BVI entity, the tax authorities treated the BVI share transfer as an indirect transfer of Korean shares and imposed corporate income tax and securities transaction tax. However, the Jeju District Court ruled in favor of the taxpayer, holding that in the absence of clear legal authority, applying a substance-over-form[5] approach would violate the principle of legality in taxation. The case (2023GuHap5879) remains pending on appeal.
• Additionally, if the Korean subsidiary is a real property holding company and the value of its shares represents over 50 percent of the foreign parent’s total assets, the transfer of the foreign parent may be recharacterized as a transfer of Korean real estate[6] based on the principle above.
• The withholding tax amount would be the lesser of (a) 22 percent of the gross transfer price or (b) 11 percent of the capital gain unless there are tax treaties which provide tax exemption.

• While there is no established guidance, the re-domiciliation of a foreign holding company (i.e., changes jurisdiction without changing legal identity) is unlikely to trigger a taxable transfer under Korean law, as there is no change in legal ownership of the Korean shares.

Taiwan

• Taiwan does not have a general rule for taxing indirect share transfers. However, an indirect transfer involving a Taiwan property-rich company may trigger the House and Land Transactions Income Tax (HLTIT) on capital gains, regardless of when the underlying properties were acquired. HLTIT is applicable if (1) the seller holds more than 50 percent of the shares or capital of the company, and (2) at least 50 percent of the company’s value is attributable to land and buildings located in Taiwan. When both conditions are met, the seller becomes liable for HLTIT.[7]
• For equity transactions, capital gains realized by nonresident shareholders are taxed at rates ranging from 35 percent to 45 percent, depending on the holding period of the shares.

• While there is no established guidance, the re-domiciliation of a foreign holding company (i.e., changes jurisdiction without changing legal identity) is unlikely to trigger a taxable transfer under Taiwan law, as there is no change in legal ownership of the Taiwan shares.

Vietnam

• From October 1, 2025, under the new Corporate Income Tax (CIT) Law, foreign corporate shareholders will be subject to CIT at a flat rate on the gross sale proceeds from the sale of shares in Vietnam nonpublic joint stock companies (JSCs) or interests in limited liability companies (LLC), whether directly or indirectly.
• Earlier drafts of the new CIT law proposed a 2 percent flat rate, but it was ultimately removed from the final version. The specific rate applicable to such transfers is expected to be clarified in the upcoming CIT Decree.

• While internal restructurings involving a change in ownership or transfer of shares shall now be subject to tax, the re-domiciliation of a foreign holding company (i.e., changes jurisdiction without changing legal identity) is unlikely to trigger a taxable transfer, as there is no change in legal ownership of the Vietnam shares, directly or indirectly.