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How to Determine Place of Supply of Services under GST- Part II

We had already discussed about the Place of Supply of Services where the location of the supplier and the recipient is in India. Now, we are going to discuss on how to determine the place of supply of services where the location of the supplier and the recipient is outside India as per Section 13 of IGST Act.

We had already discussed about the Place of Supply of Services where the location of the supplier and the recipient is in India.  Now, we are going to discuss on how to determine the place of supply of services where the location of the supplier and the recipient is outside India as per Section 13 of IGST Act.

Place of Supply of Services where location of supplier and recipient is outside India

As a general rule, the place of supply of services except for the specific services shall be the location of the recipient of services; if the location is not available the place of supply is the location of the supplier of services.

Place of Supply of Specific Services:

  • The place of supply of the below services is the location where the services are actually performed:
    • Services supplied in respect of goods which are required to be made physically available to the supplier of services or to a person acting on behalf of the supplier of services by the recipient of services
  • If the services are provided from a remote location by way of electronic means, the place of supply shall be the location where the goods are situated at the time of supply of services
  • Nothing contained in this clause if the services in respect of goods which are imported into India for repair purpose and are exported after repairs without being put to any other use in India
    • Example 1: ‘A’ from China sends goods to ‘B’ in Mumbai, India for assembling work, the place of supply is Mumbai – CGST & SGST will be levied
    • Example 2: ‘C’ provides repairing service to a computer which is located in United States, the place of supply is United States where the goods are situated – It is an export of service
  • Services supplied to an individual who represents either as recipient or a person acting on behalf of the recipient of services, which require the physical presence of such recipient or such person with the supplier of services
  • Example: ‘A’ from France comes to India, his stay and travelling services are provided by the company ‘B’ in Delhi, India, the place of supply is Delhi – CGST & SGST will be levied
  • Services related to an Immovable property – Place of supply of is the location of the immovable property – services includes
    • Services provided by experts, estate agents
    • Services by way of accommodation by hotel, inn, guest house, club or campsite
    • Services by way of grant of right to use the immoveable property
    • Services for carrying out or co-ordination of construction work including that of architects or interior decorators
  • Services by way of admission to or organisation of the below:
    • Cultural, artistic, sporting, scientific, educational or entertainment events
    • Celebration, conference, fair, exhibition or similar events
    • Ancillary services related to such admission or organisation
  •  place of supply is the location where the event is actually held
  • Place of supply for the following services is the location of supplier of services:
    • Services supplied by banking, non-banking or a financial institution to its account holders
    • Intermediary services
    • Services consisting of hiring of means of transport, including yachts but excluding aircrafts and vessels, up to a period of one month
  • Transportation of goods other than mail or courier – place of supply is the destination of goods
    • Example: ‘A’ a liner, in India provides shipping services for the transportation of goods from India to China, place of supply is China, export of service
  • Passenger transportation services – place of supply is the location where the passenger embarks on the conveyance for a continuous journey
    • Example: ‘A’ from Chennai issues air ticket to ‘B’ in Mumbai, to travel from India to China, he boards on the place in Mumbai, India, the place of supply is Mumbai, CGST and SGST will be levied. ‘A’ needs to be registered in Mumbai
  • Services on board a conveyance
    • The place of supply for the services provided on board a conveyance, during the course of a passenger transport operation, including services intended to be wholly or substantially consumed while on board – the location of the first scheduled point of departure of that conveyance for the journey
  • Online Information and Database access
    • The place of supply of online information and database access or retrieval services shall be the location of the recipient of services

Note: For the purpose of this sub-section, the person receiving such services shall be deemed to be located in the taxable territory, if any two of the following non-contradictory conditions are satisfied:

  • Location of address presented by the recipient of services through internet is in the taxable territory
  • Payment is made by the recipient through a debit or a credit card or any other similar cards which has been issued in the taxable territory
  • The billing address of the recipient is in the taxable territory
  • The Internet Protocol (IP) address of the device used by the recipient is in the taxable territory
  • The bank of the recipient through which the payment is made is located in the taxable territory
  • The country code of the subscriber identity module card used by the recipient is of taxable territory
  • The location of fixed land line through which the service is received by the recipient is in the taxable territory
  • For preventing double taxation or non-taxation or for the uniform application of rules, Government has the power to notify any description of services or circumstances in which the place of supply shall be the place of effective use and enjoyment of a service
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