Rcm on advocate
This query is : Resolved
13 April 2015
If advocate provide service to those who has not a registration No of service tax then who's liable to pay service tax on that case.
13 April 2015
In case of advocates if service is provided to a business entity having turnover exceeding Rs. 10 lakhs then the business entity is liable for payment of service tax.
14 April 2015
If Business entity don't have a turnover of Rs 10 Lakh in that case who is liable to pay
14 April 2015
Neither of the service provider or receiver
14 April 2015
But in Invoice it is clearly mentioned that Service receiver is liable to pay service tax in that case someone has to pay the taxes otherwise government has bear loss of revenue.
14 April 2015
as per mega exemption notification no. 25/2012
6. Services provided by
(b) an individual as an advocate or a partnership firm of advocates by way of legal
services to,-
(i) an advocate or partnership firm of advocates providing legal services ;
(ii) any person other than a business entity; or
(iii) a business entity with a turnover up to rupees ten lakh in the preceding financial year; or
(c) a person represented on an arbitral tribunal to an arbitral tribunal;
is exempt from levy of service tax.
Hence the same is not liable for service tax under reverse charge method also. Further the purpose of this exemption was to save small business people from the hassels of service tax like taking registration paying taxes and filing return.
Further practically Rs. 10 lakhs is a very small limit kept and there shall be very nominal loss of revenue to the government.
6. Services provided by
(b) an individual as an advocate or a partnership firm of advocates by way of legal
services to,-
(i) an advocate or partnership firm of advocates providing legal services ;
(ii) any person other than a business entity; or
(iii) a business entity with a turnover up to rupees ten lakh in the preceding financial year; or
(c) a person represented on an arbitral tribunal to an arbitral tribunal;
is exempt from levy of service tax.
Hence the same is not liable for service tax under reverse charge method also. Further the purpose of this exemption was to save small business people from the hassels of service tax like taking registration paying taxes and filing return.
Further practically Rs. 10 lakhs is a very small limit kept and there shall be very nominal loss of revenue to the government.
14 April 2015
Thanks now it is clear..!!
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