Reimbursement of expenses Import of Service- Service tax chargeability

[Asked by Guest]

Reimbursement of expenses Import of Service- Service tax chargeability
Dear Sir, Is Service tax chargeable on reimbursement of expenses in case of import of Service. Service such as a video conference was held in the Ho office of Mumbai and for the authority for SYSTEM USAGE CHGS-VIDEO CONFERENCE SYSTEM WITH our Parent company (Japan) charges were paid. Please explain regarding this, Pls give any reference regarding this. Thanks and regards.

[Rajagopalan Ranganathan]

Sir,

With effect from 1.7.2012, taxable services provided from outside India , valuation will be on the basis of rule 3 to 6 of Service Tax (Determination of Value) rules, 2006 as applicable.

Prior to 1.7.2012 rule 7 (1) of Service Tax (Determination of Value) rules, 2006 provided that the value of any taxable service received under the provisions of Section 66A of finance Act, 1994 shall be taken to be such amount as is equal to the actual consideration charged for the services so provided or to be provided. this rule was omitted with effect from 1.7.3012.

AI Summary

Valuation of imported services now follows detailed valuation rules rather than being confined to actual consideration for service tax purposes.
Valuation of taxable services received from outside India is governed by Rules 3-6 of the Service Tax (Determination of Value) Rules, 2006 with effect from 1 July 2012; this replaced Rule 7(1), which had taken value to be the actual consideration charged for services received.