We are a college in India and as part of the MBA program our students would be attending an international study tour in Dubai. The college is paying the entire costs of the the tour program to a supplier in Dubai which is delivering the services for the international study tour.The supplier in Dubai has invoiced the total amount in AED to us and we are supposed to make the payment against the invoice through international bank transfer. My question is whether we have a tax implication on this transaction in India whether we are liable to pay any taxes and what would that clause be for the taxation act.
No since the service is being provided to you outside India by a non resident you don't have any tax liability (i.e. liability to deduct TDS) in India.
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Thank you
Hi,
- As the location of the supplier and place of supply is outside India, no GST would be applicable to college in India.
- Under Income tax, Income is accrued or received outside India by Dubai Supplier so no income tax implication in India but still you need to file Form 15CA which is online for remittance to Dubai supplier. Please obtain no PE certificate from Dubai supplier.
Thanks
Hi
For foreign remittance you have to fill 15CA form and submit to bank during remittance.
No GST will apply in this case as place of supply and location of supplier is outside India.
Hope it helps
Dear Sir,
Hope you are doing well !!
No, you are not liable to pay/deduct any taxes in India.
Thanks & Regards,
Payal Chhajed
As these income has come to Dubai entity from India, it may be deemed as taxable in INDia. However, the Dubai entity can claim DTAA benefit stating that it is business income and hence it does no have Permanent Establishment in IDNia and hence no tax. However, DTAA benefit is available only if Dubai entity has TRC, NO PE, FORM 10F and other supporting docs. Also, you should take a CA certificate in form 15CB before making the remittance. The bankers would insist on this doc, else would not proceed.
