Input service tax treatment
This query is : Resolved
15 April 2013
x Ltd engaged in export of service (Say Marketing Research) they receive input Service Say Advertising, As they are into export of services there is no service tax liability, in such case what will be treatment for input service tax on advt services?
Is claiming of refund allowed ?
or the Service tax Amount will become cost and added to advt amt
Kindly Guide in above matter
Is claiming of refund allowed ?
or the Service tax Amount will become cost and added to advt amt
Kindly Guide in above matter
15 April 2013
You may claim refund instead of claiming cenvat of service tax paid on input services used in export of service. for reference please read notification No.Notification No.39/2012-ST dated 20.06.2012.
16 April 2013
as Mr.X is engaged in Export of Marketing Service, will he be eligible to claim Refund for Input Services like Advt, ST paid to Recruiters like naukri site people for hiring people will this be considered as input service for said purpose?
And What is difference between Rebate and Refund?
And What is difference between Rebate and Refund?
16 April 2013
Hello,
For Claiming the Refund,go through the Form-A,provide u u r email-id so thta form be can be mailed u...if reqd.
For Claiming the Refund,go through the Form-A,provide u u r email-id so thta form be can be mailed u...if reqd.
16 April 2013
kindly send me form at panupkadam@gmail.com and what about eligibility of above mentined services for input credit
01 August 2024
For a company engaged in the export of services, such as X Ltd in your example, here’s how the input service tax on advertising services (or any other input services) would be treated:
### **1. Treatment of Input Service Tax**
#### **Refund of Input Service Tax**
- **Export of Services**: Under the Service Tax regime, services exported out of India are generally considered as zero-rated. This means that although the export of services is subject to a zero percent service tax rate, you can still claim a refund of the input service tax paid on services used to provide such exports.
- **Eligibility for Refund**: Yes, X Ltd can claim a refund of the input service tax paid on advertising services and other input services related to the export of services. The refund mechanism allows you to claim back the service tax paid on inputs used in providing the exported services.
#### **Claiming Refund**
- **Application Process**: To claim a refund of the input service tax, X Ltd needs to file a refund claim with the Service Tax department. This is typically done using Form A, along with supporting documentation, including:
- Proof of payment of service tax on input services.
- Evidence of export of services.
- Relevant invoices and documents.
- **Eligibility of Services**: Advertising services and recruitment services like those provided by Naukri.com are generally considered as input services for the purpose of providing exported services, provided they are used directly or indirectly in relation to the export.
### **2. Rebate vs. Refund**
- **Rebate**: A rebate is a mechanism that allows for a reduction of the tax liability. For exports, the rebate often applies to excise duty or service tax paid on inputs used in the manufacture or provision of goods and services. It is typically applied to reduce the amount of tax payable.
- **Refund**: A refund is the process of reclaiming the tax paid on inputs that were not utilized because the output was exempt or zero-rated. In the case of exports, since the output is zero-rated, a refund is applicable to recover the input tax credits.
### **3. Form for Claiming Refund**
- **Form A**: The specific form for claiming a refund of service tax for exports is typically Form A (or the relevant form applicable under the Service Tax rules).
You can request the form directly from the Service Tax department or your tax consultant. Since you requested to email the form, here's a general outline of the process:
1. **Obtain Form A**: Download the form from the official website of the CBEC (Central Board of Excise and Customs) or request it from the local tax office.
2. **Fill Out the Form**: Complete the form with the required details and attach supporting documents.
3. **Submit the Claim**: Submit the completed form and documents to the Service Tax department.
**Email for Form Request**: If needed, you can contact the tax department or a tax professional to obtain the form. Unfortunately, I cannot send forms via email, but you should be able to find the form on the official CBEC website or request it from your local tax office.
### **Summary**
- **Input Service Tax Refund**: Yes, X Ltd can claim a refund of the input service tax paid on advertising and other services used in providing exported services.
- **Refund Process**: Use Form A or the relevant refund form, and ensure that all required documentation is provided.
- **Rebate vs. Refund**: Understand the difference—rebate reduces tax liability, while a refund is a reclaim of tax paid on inputs for zero-rated exports.
For specific guidance and to ensure compliance, it's always a good idea to consult with a tax advisor or professional.
### **1. Treatment of Input Service Tax**
#### **Refund of Input Service Tax**
- **Export of Services**: Under the Service Tax regime, services exported out of India are generally considered as zero-rated. This means that although the export of services is subject to a zero percent service tax rate, you can still claim a refund of the input service tax paid on services used to provide such exports.
- **Eligibility for Refund**: Yes, X Ltd can claim a refund of the input service tax paid on advertising services and other input services related to the export of services. The refund mechanism allows you to claim back the service tax paid on inputs used in providing the exported services.
#### **Claiming Refund**
- **Application Process**: To claim a refund of the input service tax, X Ltd needs to file a refund claim with the Service Tax department. This is typically done using Form A, along with supporting documentation, including:
- Proof of payment of service tax on input services.
- Evidence of export of services.
- Relevant invoices and documents.
- **Eligibility of Services**: Advertising services and recruitment services like those provided by Naukri.com are generally considered as input services for the purpose of providing exported services, provided they are used directly or indirectly in relation to the export.
### **2. Rebate vs. Refund**
- **Rebate**: A rebate is a mechanism that allows for a reduction of the tax liability. For exports, the rebate often applies to excise duty or service tax paid on inputs used in the manufacture or provision of goods and services. It is typically applied to reduce the amount of tax payable.
- **Refund**: A refund is the process of reclaiming the tax paid on inputs that were not utilized because the output was exempt or zero-rated. In the case of exports, since the output is zero-rated, a refund is applicable to recover the input tax credits.
### **3. Form for Claiming Refund**
- **Form A**: The specific form for claiming a refund of service tax for exports is typically Form A (or the relevant form applicable under the Service Tax rules).
You can request the form directly from the Service Tax department or your tax consultant. Since you requested to email the form, here's a general outline of the process:
1. **Obtain Form A**: Download the form from the official website of the CBEC (Central Board of Excise and Customs) or request it from the local tax office.
2. **Fill Out the Form**: Complete the form with the required details and attach supporting documents.
3. **Submit the Claim**: Submit the completed form and documents to the Service Tax department.
**Email for Form Request**: If needed, you can contact the tax department or a tax professional to obtain the form. Unfortunately, I cannot send forms via email, but you should be able to find the form on the official CBEC website or request it from your local tax office.
### **Summary**
- **Input Service Tax Refund**: Yes, X Ltd can claim a refund of the input service tax paid on advertising and other services used in providing exported services.
- **Refund Process**: Use Form A or the relevant refund form, and ensure that all required documentation is provided.
- **Rebate vs. Refund**: Understand the difference—rebate reduces tax liability, while a refund is a reclaim of tax paid on inputs for zero-rated exports.
For specific guidance and to ensure compliance, it's always a good idea to consult with a tax advisor or professional.
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