amit arun associates
   
Home Contact Us Site Map
Home about us Latest News Contact us

Fixed Assets Verification Services

Payroll Processing Service

Employee Benefit Administration

Tax Consulting

Foreign Direct Investment

File GST & E-TDS Returns
 
 
 
 
 

Provision of service Rules 2012

Posted @ March 29, 2013, 4:42 am under (Service Tax Updates)

Provision of service Rules 2012

NOW EXPORTERS of services need not comply with Rule 6A of the Service Tax Rules stipulated by notification 36/2012 of Service Tax.

The Export of Service Rules 2005 and Services (provided from outside India and received in India) Rules 2006. Have been replaced with a set of Rules called place of provision of service Rules 2012 by Notification No.28/2012 dated 20th June 2012. These Rules now determine” taxable territory” and consequently taxability of a service rendered when either service a receive recipient is located outside India or in J & K.

Once a taxable service is determined, in terms of Place of Provision of Service Rules, as rendered outside the Taxable Territory, the question of granting exemption under Rule 6A of Service Tax Rules as Export of Service does not arise at all. This is because, once a service is determined to be rendered outside the taxable territory, the charging section 66B will not apply and consequently there is no need to go to service tax Rules to get exemption as Export of Service.

Now let us look at Rule 6A of Service Tax Rules which determines when a service will be treated as Export of Service

RULE 6A (1) - The provision of any service provided or agreed to be provided shall be treated as export of service when

a. the provider of service is located in the taxable territory

b. the recipient of service is located outside India

c. the service is not a service specified in the section 66D of the Act

d. the place of provision of the service is outside India

e. the payment for such service has been received by the provider of service in convertible foreign exchange; and

f. the provider of service and recipient of service are not merely establishment of a distinct person in accordance with item (b) of Explanation 2 of clause (44) of section 65B of the Act.

Rule 3 of Place of Provision of Service Rules 2012 which is reproduced herein under, defines that the place of provision is recipient of service and only in cases where the location of service receiver is not available in the ordinary course of business; the place of provision of service shall be the location of the provider of service

The Charging Section (section 66 B)

The main ingredients for a service tax to be levied are

1. It should meet the definition of service” as inserted in the Finance Act in 2012.

2. Must not be listed in the negative list services” defined under section 65D of the Finance Act 1994

3. The services should be provided or agreed to be provided in the taxable territory

4. by one person to another.

 

Once the place of provision is outside India in terms of the above Rule then automatically there will be no service tax as the charging section 66B will not authorize any levy.

4. by one person to another.

 

 

 

Website : www.amitarun.com


Website Designing  Company Image Map
Contact us Disclaimer Privacy Policy Site Map