Foreign Service

[Yogesh Panchal]

Dear Sir,

Recently we have availed service from foreign overseas Commission Agent, we have received Export order for the same, now we have paid Commission to foreign overseas Commission Agent in Foreign exchange, we have liable to pay service tax under reversal Charges?? Please advise.

AI Summary

Service Tax on Foreign Commission: Exemption Available with Contract per Notification 42/12, Unconditional Since Finance Act 2014. A user inquired about the obligation to pay service tax on commissions paid to a foreign overseas commission agent after receiving an export order and paying in foreign exchange. Two responses were provided. The first response confirmed the obligation but mentioned an exemption under notification 42/12, noting that since the Finance Act 2014, the transaction is unconditionally exempt. The second response added that a contract between the overseas agent and the company is required to avail the exemption under notification 42/12.