Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

Export of services rules

sanjay shah (properitor) (71 Points)

06 June 2012

Can Anybody guide wether now Export of service rules which were uptil now exempted from service tax has ceased to exist after the negative list proposed by govt or are they still into effect?

If no more valid from how and when will the export of services be taxed now.

Reply
Follow
Share

9 Replies

Prateek Agarwal (Sr. Executive - Finance & Accounts) (1732 Points)
Replied 06 June 2012

Export of services were exempted before but noe they have become non-taxable services.

Upgrade to CAclubindia Pro. Subscribe Now!

sanjay shah (properitor) (71 Points)
Replied 07 June 2012

Dear Mr Prateek

Did not undersatnd your reply.First it was exempted and now non taxable?whats the diff?Both means service tax not payable?

We are agents for few overseas co and sell their products in India to direct importers.We are paid commission by overseas co in usd.Are we under service tax now?

Sanjay

Prateek Agarwal (Sr. Executive - Finance & Accounts) (1732 Points)
Replied 07 June 2012

Yes sir, they both mean that you dont have to pay service tax on export of services. Condition is that the consideration must be received in convertible foreign exchange which you are getting.

Hence, you are outside the purview of service tax.

Moush (Ex - Article) (23 Points)
Replied 27 June 2012

Mr.Prateek Agarwal, Plz help me.. My problem is similar to Mr. Sanjay Shah.. Its a UK based company, Iam giving them some consultancy services. Dey r paying in GBP bt I shall receive in INR via My local Bank with the help of London based Routing Bank.

Am I Liable for Service Tax??

Prateek Agarwal (Sr. Executive - Finance & Accounts) (1732 Points)
Replied 27 June 2012

If they are paying you in Indian Rupees, then the condition is not met. Hence, I think you are attracting service tax.

The condition is to receive foreign currency, not INR.

Upgrade to CAclubindia Pro. Subscribe Now!

Moush (Ex - Article) (23 Points)
Replied 27 June 2012

Sir I have modified the question now.. So now also am I liable for service tax??

Prateek Agarwal (Sr. Executive - Finance & Accounts) (1732 Points)
Replied 27 June 2012

Dear Sir,

The mode of payment received is foreign currency. What I am construing is that you are converting the same into INR and then crediting it to your bank. If thats the case, then you are not liable to tax.