Reverse charge on services provided by advocates

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

08 August 2012 Hi,

My client received some services from an advocate based in Delhi, since there is a stay of delhi high court for service tax on advocates, they dont charge service tax. Now under the reverse charge mechanism would my client( based in mumbai) be liable to pay service tax on the services received from an advocate based in Delhi.

Thanks in advance for your reply.

Querist : Anonymous

Querist : Anonymous (Querist)

08 August 2012 Dear Sir

Our company hire labor on contract basis.Pls confirm who will deposit service tax.

RENGARAJ R.K

RENGARAJ R.K (Expert)
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08 August 2012 Advocate services:

Your client has to deposit service tax 100% on the bill value under reverse charge and can set off if such services are in relation to his output services.

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RENGARAJ R.K

RENGARAJ R.K (Expert)
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08 August 2012 Labour contract:

This is a manpower agency service. Under reverse charge, service provider has to pay 25% of the value of the bill and service receiver has to pay 75% on the bill value.

Both have to deposit tax as per the proportion given above.

CA Suresh Jain

CA Suresh Jain (Expert)
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09 August 2012 This is w.e.f. 01.07.2012 and as per Notification No. 30/2012-ST dated 20.06.2012.

Nishant

Nishant (Expert)
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08 October 2012 In case of services from advocate, please confirm your turnover for the previous year. If the turnover is less than 10 lacs, then you need not pay service tax on reverse charge basis, else you need to pay service tax on the same. Reference Notification No. 25/2012

In case of the labor on contract basis, the service recipient has to pay service tax in case the labour service provider is a non company entity and your liability will be restricted to 25% of the consideration.