Respected Sir/s,
MCI, India has raised working capital loan from Bank of Tokyo and MCHC, Japan, (Parent Company of MCI, India) has provided the bank guarantee to Bank of Tokyo, on behalf of MCI, India
Guarantee fee is now charged by MCHC, Japan to MCI, India.
Request you to confirm the TDS & Service tax liability in this Transaction.
With Regards.
Clarification Sought on TDS and Service Tax Liabilities for Guarantee Fee by Japanese Parent to Indian Subsidiary A discussion on a forum involves a query about the tax implications of a guarantee fee charged by a Japanese parent company, MCHC, to its Indian subsidiary, MCI, for a bank guarantee provided to the Bank of Tokyo. The query seeks clarification on the TDS and service tax liabilities associated with this transaction. Replies include a request for clarification on whether the fee is a service charge and confirmation that service tax is applicable on the guarantee fee, which is calculated at 1.5% per annum on the working capital loan. (AI Summary)
TaxTMI 
TaxTMI 
TaxTMI 
