TMI BlogSAC Code & POS required for Commission IncomeX X X X Extracts X X X X X X X X Extracts X X X X ..... Dear Experts, We have commission income on account of contract with one party (Location outside India) who supplies IT related software to our customers ( Outside India within India both). Sometimes we also provide development services on that software as required by customers we charge separately to customers for that. Please suggest regarding POS that it is Export or not and SAC to be used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for that commission Income ? Thank You ! - Reply By Amit Agrawal - The Reply = In terms of Section 13 (8) (b) of IGST Act, 2017 , place of supply - in case of intermediary services - is the location of the supplier. As location of supplier - in given case - is in India and location of service recipient (i.e. who pays commission) is outside India, place of supply is location of the supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lier (i.e. 'India') in terms of above quoted sub-section. One of the condition for treating any service as export - in terms of Section 2 (6) of the IGST Act, 2017 - is that the place of supply of service should be outside India. As this condition is not fulfilled, given services cannot be treated as 'Export of Service under current GST laws. Next question is nature of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxes (i.e. CGST SGST or IGST) which is payable on said transaction. In other words, whether said supply is 'intra-state' or 'inter-state' supply? These are highly controversial issue/s and the same will ultimately decided by our Apex court - in one way or other. Till then, my views are as follows: A. Section 8 (2) of the IGST Act, 2017 is subject to provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 12 . Section 12 determines place of supply of services where location of supplier and recipient is in India, which is not the situation described above. Hence, subject supply as not intra-state in my view. Just FYI: I have explained my views in very brief on TMI sometimes back on 28.01.2021 under issue-ID No. 116950 bearing subject-line: GST on intermediary service . B. But, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I also hold view that subject transaction is not inter-state supply either. And I explained reasons behind my views on TMI long back on 29.01.2019 in my article ( Article ID - 8346 ) on this portal: A view: Why Intermediary Service provided to recipient located outside India cannot fall under Inter-State Supply and Why IGST is not leviable there against? And alternatively, why such prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision treating it as Inter-State Supply will be unconstitutional? Link to said article : https://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=8346 Summarizing above, I am of the view that neither IGST nor 'CGST SGST' is payable on subject transaction as same is not taxable under current GST laws. These are strictly my personal views. And same sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not be construed as professional advice or suggestion in any way. - Reply By RangaRao Kilaru - The Reply = 1. if the commission income is received in foreign exchange then it is treated is export of service and no tax is payable. 2.on developement service provided by you: If it is to a person located outside India and foreign exchange is received then it it is not taxable. if it is provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded to person located in India, it taxable. - SAC Code & POS required for Commission Income - Query Started By: - Ashiesh Prremji Dated:- 14-8-2022 Goods and Services Tax - GST - Got 2 Replies - GST - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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