03 August 2011
MY CLIENT IS RETIRED PSU EMPLOYEE, WHO HAS BEEN RETAINED BY A LIMITED COMPANY TO DO LIASONING WORK. HE IS PAID FIXED MONTHLY AMOUNT ON WHICH TDS IS DEDUCTED. TDS CERTIFICATES SHOWS THESE MONTHLY PAYMENT AS FEES.
I WOULD LIKE TO KNOW UNDER WHICH CATEGORY SUCH SERVICES WOULD BE TAXBLE IF - (1) HE IS PROFESSIONALLY/TECHNICALLY QUALIFIED
(2) HE DOES NOT HOLD ANY PROFESSIONAL /TECHNICAL QUALIFICATION AS SUCH.
1. First the services are taxable under the Service Tax Scheme. 2. Either this could fall under Consulting Engineer or Business Auxilary Services depending upon the exact nature of service rendered. Hence the taxability of the serivce is established. 3. If the aggregate of all the services rendered (both taxable as well as exemptedservices) by your consultant in any FY does not exceed Rs.10.00 lakhs, then he is outside the purview of service tax scheme, by virtue of not crossin the threshold limit. 4. If the 3 above is ascertained, you can take a declaration by your consultant in his monthly / periodical claim autenticating the Point (3) given above.
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