Service tax on commission paid to non resident
This query is : Resolved
V.T.SYAMKUMAR
(Querist)
07 March 2012
Whether Service Tax is applicable on Commission paid to a non-resident agent?
07 March 2012
Dear friend,
The chargeability of TDS and Service Tax depends upon DTAA with that country. Please clearify whether NRI has permanent establishment in India our not. The country involved and DTAA. As per provisions of Finance Act, when an India received any service from NRI as a service receiver , He has to duduct Service Tax and pay to the government. Then in your case you have to deduct service tax.
The chargeability of TDS and Service Tax depends upon DTAA with that country. Please clearify whether NRI has permanent establishment in India our not. The country involved and DTAA. As per provisions of Finance Act, when an India received any service from NRI as a service receiver , He has to duduct Service Tax and pay to the government. Then in your case you have to deduct service tax.
Krishna Mohan
(Expert)
07 March 2012
Commission paid to non-resident agent shall be taxable to Service Tax in India assuming that the services rendered by the agent are consumed india. However, the liability to pay the ST is on the service receiver and not the commission agent.As the author asked only service tax implication, TDS provisions are not discussed here.
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