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Ceiling on agency commission abroad

Hi!, Is there any ceiling on agency commission that we can pay for sales to agents abroad ? I understand that it is limited to 12.5% of the FOB value as per RBI. If someone demands a higher commission then what do we do ? And what if the agent takes care of after sales service. this question pertains to exports from India. Hot Topic Recommend • Asking Appropriate Questions • My English is bad , what can I do ? • Customers Requesting Credit • Questions about new products • What\'s the real exchange rate? • How to convince our partner? • Chinese Sales Staff • How can i get order! • Web auctions hurt your potential? • What a strange chinese product!!

Posted on 2013-02-15 00:58:40

All Answers

You can try a separate service contract or routing the export contract though a third party/sister concern. Ofcourse you have to consult all relevant experts before jumping in.

2013-02-15 00:58:40

How do you want to pay the commission?RBI has laid down guide lines for paying commission in foreign currency.Your annual Income Tax returns will be scrutinized if you show higher commission than the prescribed set guide lines.You can route your payments under different heads. Yes, 'After Sales Service' could be one of them.*Promotional Activities and many other heads.Your Chartered Accountant is the best person to solve  your case and guide you in the right direction.[em7]

2013-02-15 00:58:40

2013-02-15 00:58:40