Payment of service tax on reversed charge method -Reg

[vinay wakde]

Some of our top Executives are visiting foreign countries for business purposes. The travel & other expenses incurred by them are booked under head “Foreign Travel” in the books of accounts. During the Excise Audit, we have been asked to pay Service Tax  on expenses done by the Executives in foreign country on reversed charge method. 

Kindly let us know whether said expenses are covered for payment of Service Tax under Section 66A?

Regards,

VINAY

 

AI Summary

Reverse charge liability for foreign travel hinges on provider location and whether services were taxed at source.
Whether travel and related expenses incurred abroad by company executives attract reverse charge depends on the service's nature and source. Air travel is generally taxed under the air travel agent service when provided by an Indian agent; foreign accommodation is classed as short term accommodation but, if provided by a hotel located abroad under the provisions for services provided from outside India, it does not create a reverse charge under Section 66A. Services from an overseas branch may raise different issues under the Explanation to Section 66A, so factual details are necessary to determine liability.