• Sending Payment to China

Hi, 
I'm operating an e-commerce company where I would like to purchase Goods & Leads from China worth Rs 20 Lacs every month and sending payment directly to their bank account

Goods => Physical products

Leads => Customer Database ( Mostly 16 lacs worth every month ) 

Now the question is => If I send directly payment from my ICICI bank do I need to pay any Reverse tax? or RCM? 

Do I need to pay equalisation Levy? 

If Yes? than what services / product I can purchase from China or any other country where I can send payment directly from my Current account and take invoice?
Asked 16 days ago in GST

Hello

 

Please note that this transaction will not have any implication of Equaisation levy on this transaction

 

With respect RCM it will apply in case of lead purchased and not in case of goods

 

Irrespective of country of payment above position will remain same

Vishrut Rajesh Shah
CA, Ahmedabad
804 Answers
30 Consultations

5.0 on 5.0

Yes, RCM will apply in your case. When you import the goods from China, IGST must be paid during customs clearance. Further, in case of import of services also, RCM will apply. You can take credit for this GST paid on the import in your GST returns. 

No, the equalisation levy will not apply in your case. 

 

 

Puja Sharma
CA, Jaipur
33 Answers

Not rated

Hi, 

 

RCM would get attracted on import of goods. However, you can claim refund or Input credit against output GST. This is irrespective of any country. 

 

Equalisation levy is not applicable in this case. 

 

Please reach out for detailed consultation. 

 

Regards

 

Prerna Peshori
CA, Pune
60 Answers

5.0 on 5.0

Any import is liable to RCM under GST.

The chinese vendor would form SEP in India and hence his business income would be taxable in India. Have you informed him about this?

Are you purchasing from same vendor?

The vendor needs to pay equalisation levy as his total receipts from India would exceed Rs. 2 crore.

 

Hope you find the information helpful, if yes do rate if 5 and provide your valuable feedback for my improvement.

Thank you.

Naman Maloo
CA, Jaipur
4026 Answers
64 Consultations

5.0 on 5.0

- E-commerce company is liable to pay RCM (i.e. IGST) while importing goods and services from China. After payment of IGST, co. can avail and utilize ITC of the same.

- Equalization levy is not applicable on such transactions.

- Services in the form of leads are liable to deduction of TDS u/s 195 alongwith submission of Form 15CB/15CA on every such transaction.

 

For detailed discussion, you may opt for phone consultation. 

Vivek Kumar Arora
CA, Delhi
4432 Answers
549 Consultations

5.0 on 5.0

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