St- rcm

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I have a party to whom i provide service in which i incur some expenses in foreign country say $3000 and i get that one reimbursed the exact amount from that party. Should i pay service tax under RCM for such transaction?
Replies (2)

There are two transactions here. One is incurring of expenditure outside India. Second one is the reimbursement received from your client in India.

As far as first transaction is concenred, depending on the nature of expenses, place of provision of service (POPS) shall be determined. POPS in most of the expenses like lodging, traveling and food would be outside taxable teritorry and hence not subject to service tax.

In second case, as far as you are acting as a pure agent the reimbursement amount shall not be included in taxable value in terms of ST determination of value rules (Rule 5(2)). 

Sir,

In my case am a owner of the vessel where i do lend my vessels on hire and i do charge ST for hire. When my vessels go to foreign waters i have to incur some expenditure on behalf of my charterer i have to incur some port agency charge. As it does not even fall under the import of services too, should i pay ST under RCM 


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