SERVICE TAX CREDIT ON BANK COMMISSION

[HEMANT KAPADIA]

Can we take service tax credit on bank commission charged by bank for collection of sale proceeds of export goods. This is in view of defination of input services where bank commission is not specifically mentioned nor services used in business activity is mentioned.

AI Summary

Input Tax Credit Available for Bank Commissions on Export Sale Proceeds, Clarified as Business Expense in GST Rules A participant inquired whether service tax credit can be claimed on bank commissions charged for collecting export sale proceeds, noting that bank commissions are not specifically mentioned in the definition of input services. Three respondents affirmed that input tax credit (ITC) is permissible. They explained that bank charges are expenses incurred in the normal course of business, and since they are related to business activities, the tax paid on these charges qualifies for ITC under GST regulations.