Commission reciept

[Asked by Guest]

Dear Sir,

Mine is a proprietorship company in India. I am acting as an agent/consultant to a foreign company for export of goods of one country to another country (not India). For this , exporting company is remitting commission to my account in India. ( say 2 to 5% of invoice value)

For this any TDS, service tax , and income tax applicable.

From the commission received in above case ,I have to pay back 50 % to a Foreign agent who is partner in this particular business. Whether I have to deduct tds, service charges/income tax

Please help me in giving correct advice.

thanks and regards

Gopal Shetty

AI Summary

FEMA current account transactions allow receipt of foreign commission in India; verify tax and service tax implications.
Tax treatment and foreign exchange compliance for commissions received in India from a foreign principal require checking service tax under the Place of Provision of Services rules and examining the contractual sharing arrangement: service tax likely not applicable where services are rendered abroad; if the proprietor receives full commission and then remits a partner's share as a diversion of income under a sharing contract, TDS may not be required. Receipt and remittance are governed by FEMA current account provisions and must follow applicable FEMA procedures.