Advantage to 100% EOU
This query is : Resolved
16 December 2009
Dear members
Our firm is a prop.ship firm with 100% EOU located at Information technology park in Chandigarh.
We are providing 100% service related to pharma covigilence to foreign clients located in different countries through IT enabled system.
We are not giving any tax on our profit/income as we have get tax holidays because of 100 % EOU status.
We purchase Information technology items like Hardware/software from India as well as from Foreign countries also.We pay Service tax and CST/VAT on purchase of these items.
Now my question is that can we get any refund of these taxes ie Service tax and CST/VAT?
please note that we have no Service tax and TIN no becouse we are not giving any output tax.
IF we are eligible to get this then what will be the procedure for this?And can we get refund of tax paid in the past?
Waiting for rply as it is very urgent..
thnx in Advance...
Our firm is a prop.ship firm with 100% EOU located at Information technology park in Chandigarh.
We are providing 100% service related to pharma covigilence to foreign clients located in different countries through IT enabled system.
We are not giving any tax on our profit/income as we have get tax holidays because of 100 % EOU status.
We purchase Information technology items like Hardware/software from India as well as from Foreign countries also.We pay Service tax and CST/VAT on purchase of these items.
Now my question is that can we get any refund of these taxes ie Service tax and CST/VAT?
please note that we have no Service tax and TIN no becouse we are not giving any output tax.
IF we are eligible to get this then what will be the procedure for this?And can we get refund of tax paid in the past?
Waiting for rply as it is very urgent..
thnx in Advance...
24 December 2009
Yes you are eligible. Please read in the article section or refer to a commentary.
24 December 2009
Sir can u plz tell me in detail??
24 December 2009
Sir can u plz tell me in detail??
Means what will the procedure to get refund?
Means what will the procedure to get refund?
14 July 2024
Based on the information provided about your firm being a 100% Export Oriented Unit (EOU) located in an Information Technology park in Chandigarh and providing services related to pharmacovigilance to foreign clients, here’s a detailed response regarding the possibility of obtaining refunds for Service Tax and CST/VAT paid on purchases:
### Service Tax Refund:
1. **Service Tax Exemption**:
- As an EOU engaged in providing services that are exported (earning foreign exchange), you are likely exempt from paying Service Tax on your output services under the Service Tax Rules.
2. **Service Tax Paid on Input Services**:
- If you have paid Service Tax on input services (such as IT hardware/software purchases), you may be eligible for a refund under the CENVAT Credit Rules, 2004.
- The CENVAT Credit Rules allow for the refund of accumulated credit in cases where the output service is exempted from Service Tax.
3. **Procedure for Refund**:
- To claim a refund of Service Tax paid on input services, you typically need to file an application with the Service Tax department.
- The application should be supported by documentary evidence such as invoices, proof of payment, and details of the export of services.
- Refund claims are subject to scrutiny by the tax authorities, and it’s important to ensure all documentation is in order.
### VAT/CST Refund:
1. **VAT/CST Paid on Purchases**:
- Similarly, if you have paid VAT/CST on purchases (whether from within India or imported), you may be eligible for a refund if the goods purchased are used in the provision of exported services.
- Each state has its own rules regarding VAT/CST refunds. Typically, refunds are claimed through the respective state VAT/CST authorities.
2. **Procedure for Refund**:
- You would need to file refund claims with the state VAT/CST department where the tax was paid.
- Documentation such as invoices, proof of payment, proof of exports (in this case, export of services), and possibly a declaration form may be required.
3. **Time Limit and Compliance**:
- Refund claims usually have a time limit within which they must be filed (often within a specified period after the end of the financial year in which the tax was paid).
- Compliance with procedural requirements and documentation is crucial to avoid delays or rejection of refund claims.
### Past Refund Claims:
- **Past Tax Paid**: You may also explore the possibility of claiming refunds for taxes paid in the past, provided you meet the eligibility criteria and can substantiate your claims with proper documentation.
### Consultation:
- **Tax Advisor**: Given the specific nature of tax holidays, export-oriented activities, and cross-border services, it is advisable to consult with a tax advisor or chartered accountant who can provide guidance tailored to your firm’s circumstances.
- They can assist in preparing and filing refund claims, ensuring compliance with tax laws, and maximizing benefits under the applicable provisions.
In conclusion, as a 100% EOU engaged in providing export services, you have potential avenues to claim refunds for Service Tax paid on input services and VAT/CST paid on eligible purchases. Proper documentation and adherence to procedural requirements are essential for successful refund claims.
### Service Tax Refund:
1. **Service Tax Exemption**:
- As an EOU engaged in providing services that are exported (earning foreign exchange), you are likely exempt from paying Service Tax on your output services under the Service Tax Rules.
2. **Service Tax Paid on Input Services**:
- If you have paid Service Tax on input services (such as IT hardware/software purchases), you may be eligible for a refund under the CENVAT Credit Rules, 2004.
- The CENVAT Credit Rules allow for the refund of accumulated credit in cases where the output service is exempted from Service Tax.
3. **Procedure for Refund**:
- To claim a refund of Service Tax paid on input services, you typically need to file an application with the Service Tax department.
- The application should be supported by documentary evidence such as invoices, proof of payment, and details of the export of services.
- Refund claims are subject to scrutiny by the tax authorities, and it’s important to ensure all documentation is in order.
### VAT/CST Refund:
1. **VAT/CST Paid on Purchases**:
- Similarly, if you have paid VAT/CST on purchases (whether from within India or imported), you may be eligible for a refund if the goods purchased are used in the provision of exported services.
- Each state has its own rules regarding VAT/CST refunds. Typically, refunds are claimed through the respective state VAT/CST authorities.
2. **Procedure for Refund**:
- You would need to file refund claims with the state VAT/CST department where the tax was paid.
- Documentation such as invoices, proof of payment, proof of exports (in this case, export of services), and possibly a declaration form may be required.
3. **Time Limit and Compliance**:
- Refund claims usually have a time limit within which they must be filed (often within a specified period after the end of the financial year in which the tax was paid).
- Compliance with procedural requirements and documentation is crucial to avoid delays or rejection of refund claims.
### Past Refund Claims:
- **Past Tax Paid**: You may also explore the possibility of claiming refunds for taxes paid in the past, provided you meet the eligibility criteria and can substantiate your claims with proper documentation.
### Consultation:
- **Tax Advisor**: Given the specific nature of tax holidays, export-oriented activities, and cross-border services, it is advisable to consult with a tax advisor or chartered accountant who can provide guidance tailored to your firm’s circumstances.
- They can assist in preparing and filing refund claims, ensuring compliance with tax laws, and maximizing benefits under the applicable provisions.
In conclusion, as a 100% EOU engaged in providing export services, you have potential avenues to claim refunds for Service Tax paid on input services and VAT/CST paid on eligible purchases. Proper documentation and adherence to procedural requirements are essential for successful refund claims.
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