31 January 2017
Say lawyer raised a bill to xyz co of Rs.30000 + 3000 ST(which is not charged separately in invoice and which is payable by xyz co on reverse charge ) Circular issued earlier for non deduction of TDS on service tax component comprised in the amount payable to a resident. Since the bill amount is 30000 no TDS will be deducted u/s 194J. But if we read the wordings of circular it is given that tds will only be not deducted only if the ST component comprised in the amount and in the present case ST is not comprised in the amount,hence tds shall be deducted on service tax amount payable on reverse charge u/s 194J . Issue:- 1)Are we liable to deduct TDS on Rs.33,000 or Rs.30,000 or not necessary to deduct?
31 January 2017
The limit u/s 194J is 30K. And u also need to deduct TDS exclusive of Service Tax. So u need to confirm once from the lawyer that the amount is inclusive of Service Tax or not. And if the amount is not inclusive of ST(means ST is not charged by the lawyer) then u need to deduct TDS on 33K @10%.
31 January 2017
Rs.30000 is purely his professional charges. And how can he include/charge ST on his bill as the same shall be payable by xyz co on reverse charge. Its arising new issue that whether ST payable on reverse charge should considered or not in determining threshold limit of 30000 as ST is payable on reverse charge..
CAclubindia
