Question11:

We are engaged in the business of working as a commission agent for export and import. On successful export/import foreign party pays us commission in foreign currency which is directly credited in our bank account. We want to know :-
1. Whether we are liable to discharge GST in respect of such commission received from foreign parties.
2. If yes whether it will be IGST or CGST & SGST.
3. Subject GST is to be worked out on inclusive basis or exclusive basis i.e. can we treat commission as inclusive of GST and work out taxable value and GST accordingly.
4. Whether such GST paid by us will be eligible to us as ITC or refund as last burden of it is on us and we are not passing it on to anyone.

Answer:

Point vise reply is as follow
1 The transaction is covered under section 13(8)(b) of IGST the place of supply is location of service provider so you have to pay tax.
2 location of receiver and location of service provider are not in same state so it is subject to IGST.
3 Since nothing is paid in addition to commission so the transaction will be treated as inclusive tax For value Rule 35 of CSGT Rules will apply.
4 The service receiver can't claim credit so it is a cost to provider .Please note it is not reveres charge so you can't claim credit of it. (Reply dt.13/12/2017)