technical consultancy paid to foreign director wheather liable to service tax we r paying amount in his bank account in india
Vikas Aggarwal (CA ) (207 Points)
27 August 2011technical consultancy paid to foreign director wheather liable to service tax we r paying amount in his bank account in india
Kiran Kumar V
(C.A. Final)
(181 Points)
Replied 28 August 2011
First check, Whether the amount paid to director in Director Capacity or Technical Consultant Capacity.
If it is paid to foreign director in Director Capacity no Service Tax is Attracted.
On the other hand, If it is paid to forign director in Technical Consultant Capacity it amounts to import of Service. Accordingly, Import of Service Rules will apply.
As per Import of Service Rules, service recepient has to pay service tax @ 10.30% under reverse charge mechanism.
Regards,
Kiran Kumar V
Vikas Aggarwal
(CA )
(207 Points)
Replied 29 August 2011
thanks
the dierctor is IT professional but does not have separate consultancy business he is only a director in the company
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