Service tax on forex commission
This query is : Resolved
06 January 2010
XYZ is a company based in Germany manufacturing automated folding machine..
ABC (FROM INDIA)assist the sales of these machines in India to end-users. When XYZ sells machines in India through ABC ,XYZ invoice the end-users directly and pay commission to ABC. Also for the spare parts sold to the customers, XYZ pays commission TO ABC.
ABC in turn help them identify customers and inform the same to XYZ. XYZ also provide service to the machines during the warranty period.
ABC RECEIVES commission in foreign exchange
WHETHER ABC IS LIABLE TO CHARGE SERVICE TAX ON ABOVE SERVICE PROVIDED?IF YES THAN IN WHICH SERVICE CATEGORY?
ABC (FROM INDIA)assist the sales of these machines in India to end-users. When XYZ sells machines in India through ABC ,XYZ invoice the end-users directly and pay commission to ABC. Also for the spare parts sold to the customers, XYZ pays commission TO ABC.
ABC in turn help them identify customers and inform the same to XYZ. XYZ also provide service to the machines during the warranty period.
ABC RECEIVES commission in foreign exchange
WHETHER ABC IS LIABLE TO CHARGE SERVICE TAX ON ABOVE SERVICE PROVIDED?IF YES THAN IN WHICH SERVICE CATEGORY?
06 January 2010
If in your case XYZ recipient of service does not have commercial presence/establishment in India then it would be constitute an Export of service and would consequently be exempt from the levy of service tax.
However if XYZ have commercial presence/establishment or office within India then service tax is applicable under Business Auxiliary service
However if XYZ have commercial presence/establishment or office within India then service tax is applicable under Business Auxiliary service
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- GST on export of services and Input Credit
- ITC temporary reversal and reclaim
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- Inventory of finished goods
- Applicable TDS rate for sale of property in Nov 2024
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- GST ON EXPORT COMMISSION
- RCM INVOICING FROM NOV-2024
- Quiery in relation to GST liability in case of an advocate who has obtained GST registration.
- Regarding Waiver of Interest levied u/s 50 of PGST/CGST Act
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- Regarding einvoice taken on nil rated sales
Trending Online Classes
CAclubindia
