Applicability of service tax on commission from abroad

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 July 2013 Hi,

I make buyer and seller connect and earn commission on that.

For Eg: Buyer is from Japan and Seller from China and I earn commission from Seller in USD in my account.

Is service tax applicable on this transaction? If yes then what is the criteria ??

Arun Kumar Singh

Arun Kumar Singh (Expert)

15 July 2013 You will pay service tax under reverse charge system.

Querist : Anonymous

Querist : Anonymous (Querist)

15 July 2013 So if suppose i receive 100USD that means it is inclusive of Service tax component of 12.36% rt? i.e.total what is receive is 112.36% ?

So what is the time to pay the service tax in this case.??

And also do i need to file the Service Tax Returns

RENGARAJ R.K

RENGARAJ R.K (Expert)

26 July 2013 The service receivers are in non-taxable territory. In my opinion, as per the education guide 5.3.2 if a service recipient is in non-taxable territory as per the place of provision rule, service tax is not applicable. The transaction takes place in foreign countries.

And the commission is also received in USD. So, a fresh thinking is necessary

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