Gst applicability on cost sharing arrangement
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
14 December 2017
Indian Private limited company carrying on machine manufacturing business has German company as an investor with 60 % holding ( who is also technology provider with Royalty to Indian Company)
Now, under cost-sharing arrangement German company is going to reimbursement Salary of Indian staff as actual and 50% of Rent and Marketing expense on an actual basis to Indian company every month (motive behind arrangement is to help Indian company market in initial years)
whether Indian company required to charge GST on expenses while claiming such reimbursement?
If someone has come across such transaction, kindly share the views taken.
Now, under cost-sharing arrangement German company is going to reimbursement Salary of Indian staff as actual and 50% of Rent and Marketing expense on an actual basis to Indian company every month (motive behind arrangement is to help Indian company market in initial years)
whether Indian company required to charge GST on expenses while claiming such reimbursement?
If someone has come across such transaction, kindly share the views taken.
15 December 2017
GST not applicable on reimbursement of expenses by holding company.
Generally GST should not be borne by foreign resident/foreign entity.
When a foreign resident buys goods in India pays GST the GST paid will be refunded at the airport.
GST not applicable on export of goods and services.
Generally GST should not be borne by foreign resident/foreign entity.
When a foreign resident buys goods in India pays GST the GST paid will be refunded at the airport.
GST not applicable on export of goods and services.
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