Accrual System

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

27 June 2011 Just wanted to know if there is any exemption from Accrual System (Point of Taxation Rules) if invoices are raised to foreign companies.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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28 June 2011 There are two system of accounting one is Cash and the other is mercantile. If cash system of accounting is followed then at the time of receipt of payment the same is to be accounted but if mercantile system is followed then you have to account for it as soon as the invoice is raised.

Querist : Anonymous

Querist : Anonymous (Querist)

28 June 2011 The point of taxation of a taxable service would be the date when the invoice for the
service provided or to be provided is issued. If the invoice is not issued within
fourteen days from the completion of provision of the service, the point of taxation would be the date of completion of service.

This was introduced in the Budget 2011, effective from April 2011 (relaxation upto June).

I wanted to understand if the same provisions relating to determination of point of taxation will apply for SERVICES RENDERED IN INDIA TO A FOREIGN CLIENT.

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