Export of service

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Rajaram Yadav (Querist)
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15 January 2015 OUR PARTNER SHIP FIRM'S NATURE OF BUSINESS IS SALES AND SERVICE OF AIR CONDITIONER, WE ARE EXPORTING GOODS AS WELL AS LABOUR SERVICES TO SHRILANKA. HOW WILL WE SHOW IT IN QUARTERLY SALES TAX RETURN.

Rajaram Yadav

Rajaram Yadav (Querist)
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05 February 2015 our partner ship firm,s nature of business is sales and service of air conditioner, we are exporting goods as well as Labour service to Shrilanka. can We show full Value (Sales + Service) in sales tax return.

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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24 July 2024 In your partnership firm, where the nature of business includes both sales of goods (air conditioners) and provision of labor services (exported to Sri Lanka), you will need to report these activities correctly in your quarterly sales tax return. Here’s how you can handle it:

### Sales of Goods (Air Conditioners)

1. **Value of Sales**: Report the total value of sales of air conditioners made during the quarter under the appropriate section for sales of goods. This should include the invoiced amount for air conditioners sold within your domestic transactions.

2. **Tax Applicable**: Calculate and include the applicable sales tax (or GST, depending on your jurisdiction) on these sales as per the tax rates applicable for air conditioners.

### Export of Labor Services

1. **Value of Labor Services**: Since you are exporting labor services to Sri Lanka, you should report the value of these services under the relevant section for services rendered outside your jurisdiction (exports).

2. **Documentation**: Ensure you have documentation supporting the export of labor services, such as invoices issued to your client in Sri Lanka, proof of payment received in foreign currency (if applicable), and any other relevant export documentation.

3. **Tax Treatment**: Typically, exports of services are considered zero-rated or exempt from sales tax/GST. This means you should not charge any sales tax/GST on the exported labor services.

### Reporting in Sales Tax Return

1. **Separate Reporting**: Differentiate clearly between sales of goods (domestic sales of air conditioners) and export of services (labor services to Sri Lanka) in your sales tax return.

2. **Value to Report**: Report the total value of sales (goods + services) separately under the respective sections applicable to each type of transaction.

3. **Tax Calculation**: Calculate and report the sales tax/GST applicable on domestic sales of air conditioners based on the sales tax rates. For the export of labor services, ensure you indicate that these are zero-rated or exempt from sales tax/GST.

### Example:

- **Sales of Air Conditioners (Domestic)**:
- Total Sales Value: INR XXXX
- Sales Tax/GST @YY%: INR ZZZZ

- **Export of Labor Services (to Sri Lanka)**:
- Total Service Value: INR ABCD
- Indicate zero-rated/exempt from sales tax/GST

### Compliance and Documentation

- Maintain proper documentation to support all transactions, including invoices, export documentation, and proof of payment.
- Ensure compliance with all statutory requirements related to sales tax/GST reporting for both domestic sales and exports of services.

By following these guidelines, you can accurately report your partnership firm’s activities in your quarterly sales tax return, reflecting both the sales of goods (air conditioners) and the export of labor services to Sri Lanka. This approach ensures compliance with tax regulations while accurately reflecting your firm’s business activities.

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