Service tax eligibility for software freelancers

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Anonymous

Software Consultant

23 Points Posted on 18 November 2015

Hi Sir,

I am a freelance Software developer, working from Panaji Goa, India. I provide software develpment services to a client in the united states. now since the service im providing is consumed in united states, do I still have to pay service tax? I expect my total billing to be alightly around 10 lakhs for current financial year.

Thank you very much for all the help in advance

Replies (4)

Madhukar N Hiregange

Chartered Accountant

33545 Points Posted on 18 November 2015

You are providing a service which is deemed to be based on location of receiver- US therefore not liable without any limit.

CA VIRAL SANGHVI

Finance head

569 Points Posted on 18 November 2015

The new charging section, section 66B, enables taxation of only such services as are provided in taxable territory. Thus services that are provided in a non-taxable territory are not chargeable to service tax. Only services provided in taxable territory will be liable to tax.

So you are not liable to pay service tax.

Anonymous

Software Consultant

23 Points Posted on 19 November 2015

Thank you Madhukar N Hiregange Sir and Viral Sir for taking the time to reply. In addition that single US Client I have another 2 Local clients who have occassional work and pay me. but the total billing from all Indian Clients will be less then about 3Laks. and only the US Client will be around 10Lakhs to 11 Lakhs. Will anything change in this case? Will I have to pay the service tax? and do i need to get service tax registration?

I really appreciate the help you provide.

CA VIRAL SANGHVI

Finance head

569 Points Posted on 19 November 2015

No, the situation is not changed as taxable service proivded in taxable territory is less than 10 lacs, you need not to register in service tax department.