02 March 2011
Case Study;- Mr. A of USA is giving professional service to Mr.B of India. Contract amount is Rs. 10 Lakhs. Contract is such that Mr. A says that he want Rs. 10 Lakhs in his hand & says that he is not concered with service tax & TDS u/s 195A. TDS Rate on such income is 20%. Service Tax Rate is 10.3%.
Both the TDS & Service Tax is to be deposited by Mr.B of India. How will the TDS & Service Tax will be computed ? Please help me out?..........
03 March 2011
You have to pay Service TAx on gross amount paid to Mr. A of USA on reverse machanism. In case, if u pay TDS also, Service TAx is to be paid on Gross AMount + TDS amount.
CAclubindia
