This is a confusing topic for my and I have saked around, with different people giving me different answers.
1. Indian company (Abc) is an agent for a foreign company (Fc). They get paid on commission basis for all the sales they do for their products.
2. Abc does not deal with any transaction of any kind for the exchange of goods between the supplier Fc and their customer in India
3. At the end of every month Abc will send an Invoice to Fc for all sales made and Fc will pay the commission.
4. Fc will transfer the commission to Abc's account in USD or Euro.
Now must Abc pay Service Tax for the commission received?
Some people say that ST must be paid only if the amount exceeds Rs. 10L every quarter.
Some say it is necessary to pay. But I am confused since Abc acts as a service provider of Fc which exempt.
Case 2:
If a software developer sells the same software to both Indian companies and Foreign companies, then he/she needs to pay service tax only when the software is sold in India. When sold outside India the payment is tax exempt. Is this true?
Thank you, Deepak
CAclubindia
