service tax on foreign commission

SUBHASH SHARMA (Querist) 07 July 2009 This query is : Resolved
ONE OF MY CLIENT IS A EXPORTER.

HE IS PAYING FOREIGN COMMISSION TO FOREIGN BUYER AT FRANCE.

IS SERVICE TAX AND TDS APPLICABLE ON IT.

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SANJAY DIXIT (Expert) 07 July 2009
In my opinion "NO".
No services in India, no service tax.
In case of foreign commission agent, service tax is not payable.

A V Vishal (Expert) 07 July 2009
Dear Subash,

Service Tax is not payable but TDS on commission paid should be deducted or else the entire expenditure will be disallowed in the year it is incurred and will be taxed.

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