Service tax on clearing and forwarding agents

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atul

partner

25 Points Posted on 20 September 2015

I am a clearance and forwarding agent providing good clearance services from china to Indian port and then from port to destination in india.

i raise 2 bills to the party, one for service rendered between china to indian port for which I outsource the same to a agent at china and then a separate bill for services in india.

My query:

1.Would the bill for services rendered outside india be exempt from service tax .

2.If , not, do I need to pay service tax on reverse charge for agent outside india.

3.as a GTA , do I pay for service tax on reverse charge on the bills of transport \ trucks hired in india even if I as GTA my self deliever the goods to excise units

Thanks

Replies (6)

jaya krishna

Chartered Accountant

305 Points Posted on 20 September 2015

Services provided to non residents nor liable charge service Tax.... As per rule 3 of place of provision of service rules 2012, the location of service receiver shall be the place of provision of service so it is non taxable territory...

atul

partner

25 Points Posted on 20 September 2015

both corporates are from india...only a agent is hired outside india to do the needful

Madhukar N Hiregange

Chartered Accountant

33545 Points Posted on 20 September 2015

If service reciver + service provider in India place of service is India.

However when one works as a pure agent ( see Rule 5(2) of ST valuation rules) then the amount paid to agent in China if on actual basis could be excluded.

If you are a logistic co doing all activities of clearing and transprtation then you ar enot GTA- need to charge the client on full value.

When doing so keeping revenue informed of what one is doing is a good way of avaoiding longer period demand.

sudarshan

656 Points Posted on 20 September 2015

1.FOR Agency services rule 9 is applicable, so , place of service provider determines taxation. The service provider is in India so taxable.

2.service tax has to be discharged on reverse charge method.

atul

partner

25 Points Posted on 21 September 2015

thanks madhukar

ur opinion was really helpful.

also if u could advice,we are registered as GTA since we charge our client for the logistics taken care especially truck hire cost.

but at th same tie we hire trucks from indivuals fleet owners.do i need to pay reverse charge on the payment i make to truck owner since i m a pvt ltd company myself

Madhukar N Hiregange

Chartered Accountant

33545 Points Posted on 21 September 2015

No transportation services is under negative list. Also exempted under not 25/12 s.no. 22 (b)- services by way of giving on hire to a GTA a neans of transportation of goods.