Is Service Tax applicable for Income from Abroad

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Hello,

This is to seek clarification from the experts whether Service Tax is applicable on the income received from abroad. In both the cases below, purchase order is received from the client based in abroad only.

Such income could be received by

a) Actually delivering the services by visiting the customer abroad and getting paid from abroad

or by

b) Instead of visiting the customer abroad for delivering the services, one executes the order from India and gets paid from abroad.

In both the cases, the payment is received form abroad in foreign currency.

Please also clarify if it is essential to get paid in foreign currency only. There are some money exchanges in the Arabian Gulf countries who can send payment in rupees to an Indian bank account straight away.

Thanks in advance.

Replies (3)

Dear Friend, 

The question is quite genuine to layman- The service Tax Applicability applies on the place of services rendered- answering your questions in simple steps

a) Actually delivering the services by visiting the customer abroad

 

Ans- Any services rendered outside INDIA will not be covered by Service Tax

b) Executing the order from abroad from India only

The question not understood- if executed from India- Service Tax Applicable not from India- no Service Tax.

No matter how you receive the payment- it applies on the place of service.

Bhavik

Thank you Bhavik for your reply. I have modified the original message to provide clarification. I hope the question is clear now. Please reply suitably.

 

I run a  website from India with a CCAvenue payment gateway.

My Customers are NRIs who are in USA.  They pay me in US Dollars.

They buy greeting cards and other stuff from my website to be delivered to their families and friends in India.

Do I need to pay any service tax?

Regards.

 

 


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