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Gst rules for representative of foreign company in india

Rules 357 views 1 replies

I have a sole proprietorship company in Bangalore and receive commission as representative of agent of a manufacturing company located in United Kingdom.  Here is how it work:

 

·         The UK manufacturer  which does not have any entity in India, let’s call it “MANF”, appoints me as a representative in India

·         I visit companies in India and promote products of company “MANF”.  i.e., marketing service to foreign company

·         Let’s say company in India  “AAA” wants to buy products of  company “MANF”.    “MANF” don’t supply any products directly to “AAA” but redirect them to a stocking distributor “DISTI” in Singapore.

·         Company “AAA”  will place order directly on “DISTI” and imports the products on their own and everything is taken care of by them only.  No way I am involved in the sales activity.

·         “DISTI” in Singapore sends  a report every month what they sold into India.

·         Based on the value of products sold into India by the “DISTI”, the “MANF” with whom I am associated sends a fixed percentage of commission into my Bank account in US$.

 

 

Questions:

 

·         Will my service is export of service with zero tax

·         Will I need to register under GST ?

·         Will I come under the INR 20 lakhs per year exemption slab?

·         If I earn Rs. 10 lakh per annum and pay 18% GST, in what way I am better it would come to a huge amount Rs. 1.8lakh.  It is better of earning Rs. 10 lakh for working for a company and pay the normal income tax.

 

I appreciate your valuable feedback

 

Thank you,

Best Regards,

YOGEESH

Replies (1)

If you are getting only commission then as per  u Section 2(13) of IGST Act you fall under intermediary service :. , intermediary is a broker or an agent who arranges or the supply of goods or services or securities, between two or more persons. But an intermediary shouldn’t supply such goods or services or securities on his own account.
And
As per section 13(8) in case of intermediatary service the place of supply is supplier place. You will charge CGST/SGST

1. So your services do not fall under export
2. No need to take Registration unless your aggregate turnover exceed 20lac

3. 2nd option working for co. as employee is better But as per my personal views putting all your labour & Sweats for Other is not good idea


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