Dear Professionals,
Query on applicability of service tax on RI Brokerage received by Insurance brokers
1) In case of large reinsurance policies done outside India with the help of insurance brokers, where premiums payable in installments (facilities are provided by Reinsurer) for 1 year policy. There are four Premium payment instalment facilities are provided to insurer by reinsurance company.
What would be the service tax liability in the hands of insurance brokers on reinsurance brokerage recd from overseas reinsurer company, in case when the policy has incepted prior to 1st July, 2012 (i.e., date of completeion of service) and the first premium installment has been paid before 1st July, 2012 but the brokerage invoice on 100% premium is raised i.e, on all four instalment premiums, after 1st july, 2012 (either within 30 days or not). Rest all 3 installments premiums fall consequent to 1st July, 2102.
See example below:
Receipt of Premium - 15th March, 2012
Ist Installment of premium - 31st March, 2012
Inception of policy - 1st April, 2012
2nd Installment of premium - 1st July, 2012
3rd Installment of premium - 1st October, 2012
4th Installment of premium - 1st Jan, 2013.
Whether service tax will be apllicable on Reinsurance Brokerage as per New service tax POPS Rule or it will be treated as export of service...?
CAclubindia
