Input tax credit of rcm paid

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

21 May 2016 Hi,

Please let me know in 2016 service-tax rules, we can take input tax credit for service tax paid as reverse charge mechanism. we had paid service-tax in may16 for the services taken during the month of april'2016, can I take input tax credit out of service-tax output payable for may16 or deduct only RCM output tax payable for this month may16.

What is exact rule please explain.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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21 May 2016 Service Tax payable under RCM has to be paid in cash only. It can not be paid using CENVAT Credit.. You can take CENVAT Credit for Service Tax paid under RCM.only after the payment.

So you can take CENVAT credit of Service Tax paid under RCM and adjust it against the Output Service Tax Payable.

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Querist : Anonymous

Querist : Anonymous (Querist)

21 May 2016 Sir,

I paid service tax with seprate challan thru Net banking.

I am unable to under stand your answer please clear with given time period.

April'16 RCM paid in may16. now my confusion is that now I can take input credit of this paid amount out of service-tax output payable May16 or

RCM output payable May16 only, which will be paid in June16. this month (May16) RCM payable amount is less than to paid input RCM (April16 month)

then what to do rest RCM input credit available. which I had paid in may16 on service taken in April16.

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CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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21 May 2016 1) RCM output always to be paid in Cash. No CENVAT Credit available.

2) Take input credit against Service Tax output payable for May 2016.

Hope its clear now.

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Querist : Anonymous

Querist : Anonymous (Querist)

21 May 2016 Thanks Sir,

Now I got it once RCM service-tax paid No CENVAT credit available as input and

service tax input or out difference to be paid.