Taxes applicable for DVP Testing done outside India for Auto Parts tool

[Girish Mahabaleshwarkar]

Respected Sir,

This is with reference to we are in to manufacturer of Auto Parts, and as per requirement of auto Industries

1) we have to develop soft tool for customer which is not going to come back to India but exporter will charge a invoice for Development charges for soft tool.

2) Also Vendor will charge for DVP testing which he has done for few Zproto parts.

We like to know which are the taxes applicable for this transaction, so that it will take care of Service tax , TDS,etc and payment can be done smoothly to Exporter & compliance of Indian statutory laws.

Regards,

Girish M.

[Ganeshan Kalyani]

Can you please simplify your query a bit more clear by giving an example that how you are going to make payment and the nature of services or transaction and to whom you are going to make the payment. This will help us in giving you a suitable reply. Thanks.

AI Summary

Cross-border service taxation: determine applicability of Indian service tax and withholding obligations on payments for overseas software development and testing. Question whether Indian tax and withholding obligations apply to payments for two cross-border services: (a) development charges for a software tool created for a customer and not brought to India, and (b) DVP testing services performed abroad on prototype auto parts; seeking guidance on applicability of service tax, TDS, and related compliance by the Indian payer when remitting to the foreign service provider.