SERVICE TAX ON MACHINERY REPAIR

[RAM SHARMA]

Dear Experts,

We have done software programing by a foreign engineer in our machine and pay his service chg including travelling expenses. What is the service tax liability on that . Will we liable for service tax on his travelling expenses.

Thanks

[YAGAY and SUN]

Service Tax will be paid on the gross amount.  Please also refer the amount remitted in FEMA Form A2 in this regard while determining the Service Tax Liability.

AI Summary

Service tax on foreign technical services applies to gross payments, including associated travel expenses and related remittances. Service tax liability arises on payments to a foreign engineer for software programming and related services, and the taxable base is the gross amount paid, including ancillary travel expenses; remittance details declared under FEMA Form A2 should be considered when determining the taxable value and compliance obligations for cross-border service payments.