TaxTMI 
TaxTMI 
If we receive an extra amount due to foreign exchange variation, then whether service tax is payable on that extra amount received on account of fluctuation ? Similarly, for amount short received due to foreifn exchange variation ??
Service tax on extra receipt due to foreifn exchange variation
29 Jan 2011 
6 Replies 
12237 Views Asked by
Exchange rate determination under service tax: GAAP-based rate at point of taxation makes later forex gains irrelevant.
When the taxable value of a service is fixed using the exchange rate applicable at the point of taxation, that valuation is final and subsequent foreign exchange gains or losses do not affect the service tax liability; a rule provides that the exchange rate for valuation is the rate determined under generally accepted accounting principles on the point-of-taxation date. (AI Summary)
When the taxable value of a service is fixed using the exchange rate applicable at the point of taxation, that valuation is final and subsequent foreign exchange gains or losses do not affect the service tax liability; a rule provides that the exchange rate for valuation is the rate determined under generally accepted accounting principles on the point-of-taxation date. (AI Summary)