Amount of commssion payable to be shown in return

[JOSHIL JAIN]

An exporter who pay commission to foregin agents for the business procoured by them. Commission is paid to them during the month of April for the whole financial year for the business procured by them during last financail year.He has to deposit service tax on the commission paid to them. But he can avial the benefit of Notification No. 18/2009-Service Tax which expempts the taxable services received by an exporter of goods in relation to GTA and Import of Business Auxilary Services- Now my question is if he takes the benefit of above said notification then how he has to file his half yearly return showing exemption amount of service tax when infact he has not paid any amount of commission during the first half year or even in second half year. Whether he has to show the amount of commission paybale and amount of service tax thereon or Whether he has to show the whole amount of commission in next financial year when in fact he paid the commission to service provider. Please adivse. Mob : 09896210875

AI Summary

Service tax exemption for exporter commissions may apply if payment occurs after notification, though accrual-based liability remains contested.
An exporter paying commission to foreign agents may be liable for service tax either when the commission accrues in the books (accrual-based liability) or when actual payment is made (payment-based liability). Notification No. 18/2009 is prospective, so accrual-recorded liabilities are not covered, but payments made after the notification date may be exempt as import of business auxiliary services; choosing the payment-based approach avoids immediate tax outgo but risks departmental challenge and litigation.