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Service tax on foreign currency remmittance

M Agarwal (Consultant) (228 Points)

29 December 2014

Hello,
I am currently a freelancer Software/Web developer/consultant residing in India. All my clients reside outside Indian territory and I get paid in USD which I accept via WIRE(SWIFT) transfer to my SBI bank.

To my understand I don't need to pay service tax as per Rule 6A of Service Tax Rules, 1994.

But do I need to register as in total my revenu goes over 10lacs per annum?.

Please note all of it is in USD which is in turn converted to INR by the bank of which I get the FIRC of.

Does EXPORT OF SERVICES 2005 change anything for me?

Does it make any difference if I get salaray for an online job instead of consultancy or devloping software and vice-versa.

Thanks.

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4 Replies

Harshal Fifadra (Chartered Accountant) (1489 Points)
Replied 30 December 2014

You are not required to pay any service tax since all the requirements for a transaction to be called as "export of service" are being satisfied.

No need to take registration since the turnover limit considers the value of taxable services and not exempt services. In your case, the turnover is crossing Rs. 10 lacs,however, the services are exempt services.

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M Agarwal (Consultant) (228 Points)
Replied 03 January 2015

Originally posted by : Harshal Fifadra
	You are not required to pay any service tax since all the requirements for a transaction to be called as "export of service" are being satisfied. No need to take registration since the turnover limit considers the value of taxable services and not exempt services. In your case, the turnover is crossing Rs. 10 lacs,however, the services are exempt services.

Hi Harshal, thanks for the response.
Do I need to get an IEC for that purpose?

Harshal Fifadra (Chartered Accountant) (1489 Points)
Replied 03 January 2015

IEC is import export code. It is required for dealers importing or exporting goods . Please clarify as to how is the software being given to your party. CD/ via code / or other means...???