Query on taxation

[Laijesh Gopi]

Hi,

I am from Kerala and I have a concern. The situation is like I am purchasing a web service and reselling it to my clients; still, the service provider would be the creator of the web service (I am just a link between the client and the service provider).

The business is in such a way that I am getting the service for Rs. 250 per person (login) including service tax. I am planning to sell it for Rs. 250. Will I have to include Service Charge in the bill to my clients? If so, how much?

AI Summary

Pure agent status determines service tax liability: qualifying intermediaries taxed only on their markup, otherwise on full receipt.
Tax liability for a reseller intermediary turns on pure agent status: if qualifying as a pure agent - evidenced by transparency to the service recipient, lack of price control, and agency agreements - amounts paid to the main provider are reimbursable and only the intermediary's service charge is taxable. If not qualifying, the intermediary's entire receipt is taxable, although cenvat credit may be available for service tax charged by the main provider.