Reverse Charge applicability on services rendered outside India

[UmeshBabu J]

Hi,

An Indian company appoints a company in UK for marketing its products in UK and US. A Fixed Fees is paid monthly to UK company. Whether service rendered by UK company attracts RCM?

Thanks 

AI Summary

Indian company paying UK firm for marketing services faces GST Reverse Charge Mechanism debate under Section 2(11) IGST Act An Indian company pays fixed monthly fees to a UK company for marketing services in the UK and US markets. The discussion centers on whether these services attract Reverse Charge Mechanism under GST law. One expert argues that RCM applies, citing this as an import of services under Section 2(11) of the IGST Act, 2017, with the Indian recipient liable to pay IGST under Section 5(3) and Notification No. 10/2017. Another expert agrees RCM applies but clarifies these are not intermediary services. However, two other experts disagree, arguing that intermediary services with place of supply outside India do not attract RCM. One expert distinguishes between fixed fees (RCM applicable) and sales commission based on specific sales (no RCM as intermediary services with place of supply outside India). The discussion reveals differing interpretations of GST provisions regarding cross-border marketing services.