Hi ,
We run a HR Services Firm, we recently aquired a client who is from USA and as they do not have presence in India they taking Manpower outsourcing services , where we employee the resources on our company payroll and the employees works under supervion and guidelines of USA compay .
As its a payroll services that we are doing , the question i have is that, Does Rule 3 apply here.
As per rule 3 of the Place of Provision of Services Rules, 2012, 'the place of provision of a service shall be the location of the recipient of service'.If the service recipient is located abroad, the place of provision of service is a non-taxable territory. Therefore, service tax is not payable on such services.
As technically the employees are working on our company rolls are working for india, but we are raising invoice for Foreign entity
Will be happy to get your inputs on the same
CAclubindia
