Who is liable to payment of service tax to service tx depart
This query is : Resolved
31 January 2014
sIR
ABC LTD(TRANSPORTER CO) DELIVERS GOODS OF MY COMPANY I.E. DFD LTD.
NOW BOTH ARE COMPANIES
WHETHER ABC LTD. IS LIABLE TO PAYMENT OF SERVICE TAX OR DFD LTD. IS LIABLE
AND WHAT AMOUNT OF SERVICE TAX WILL BE PAID BY BOTH IN CASE OF LIABILITY
DHEERAJ
ABC LTD(TRANSPORTER CO) DELIVERS GOODS OF MY COMPANY I.E. DFD LTD.
NOW BOTH ARE COMPANIES
WHETHER ABC LTD. IS LIABLE TO PAYMENT OF SERVICE TAX OR DFD LTD. IS LIABLE
AND WHAT AMOUNT OF SERVICE TAX WILL BE PAID BY BOTH IN CASE OF LIABILITY
DHEERAJ
31 January 2014
Hi
Service provider is liable to charge ST & pay to govt. dept.
Thx
Service provider is liable to charge ST & pay to govt. dept.
Thx
31 January 2014
SUPPOSE ABC LTD(SERVICE PROVIDER) IS A PROPERIETOR SHIP CONCERN OR HUF THEN WHAT WILL BE THE ANSWER
WILL STILL THE ABC LTD BE RESPONSIBLE
IF NOW DFD LTD IS RESPONSIBLE THEN DOES THIS MEAN SERVICE TAX REVERSE MECHANISM IS TO PROTECT SOLE PROPRIETOR/HUF/PARTENERSHIP CONCERN FROM SERVICE TAX LIABILITY
PL EXPLAIN THE LOGIC BEHIND REVERSE CHARGE MECHANISM
WILL STILL THE ABC LTD BE RESPONSIBLE
IF NOW DFD LTD IS RESPONSIBLE THEN DOES THIS MEAN SERVICE TAX REVERSE MECHANISM IS TO PROTECT SOLE PROPRIETOR/HUF/PARTENERSHIP CONCERN FROM SERVICE TAX LIABILITY
PL EXPLAIN THE LOGIC BEHIND REVERSE CHARGE MECHANISM
31 January 2014
In that situation your co. will deposit tax with govt. The rational behind RCM is not to put responsibility on unorganized sectors who many a time don't deposit tax after collection.
01 February 2014
Sir
then how come in the case GTA being a company service provider and service recipient being also a company
but liability for service tax payment is passed on to recepient.
if idea is to protect unorganised sector then in this case service provider is also company even then liability is passed on to service received
pl elaborate more
then how come in the case GTA being a company service provider and service recipient being also a company
but liability for service tax payment is passed on to recepient.
if idea is to protect unorganised sector then in this case service provider is also company even then liability is passed on to service received
pl elaborate more
01 February 2014
In first reply Mr. Vaibhav has already said that in case of company providing the service, the provider will charge and deposit the service tax. And in my earlier reply I have made clear that in case of individual,HUF etc. the recipient will directly deposit tax with Government. So please tell where is confusion.
03 February 2014
sorry to trouble you again
but
as per my knowledge IN THE Category of GTA
100% LIABILITY OF SERVICE TAX LIABILITY IS ON THE RECEPIENT OF SERVICE, IT DOES NOT MATTER IF GTA IS COMPANY OR INDIVIDUAL OR HUF OR FIRM ANY THING
PL CLARIFY THIS POINT IF 100% LIABILITY IS ON THE RECEPIENT THEN HOW YOU ARE SAYING PROIVDER WILL CHARGE AND DEPOSIT SERVICE TAX
I THINK ONE OF THE MAIN BASIC RULE I AM NOT PICKING
IF POSSIBLE DO GIVE BASIC PRINCIPLE OF REVERSE CHARGE
PL MENTION CATEGORY WISE FOR EACH OF SERVICE ON WHICH REVERSE CHARGE IS APPLICABLE
I.E.
GTA(SERVICE PROVIDER) SERVICE RECEPNT
COMPANY COMPANY
INDIVIDUAL INDIVIDUAL
HUF HUF
FIRM FIRM
MANPOWER AGENCY
SERVICE PROVIDER SERVICE RECEPIENT
COMPANY COMPANY
INDIVIDUAL INDIVIDUAL
HUF HUF
FIRM FIRM
THANKS IN ADVANCE
but
as per my knowledge IN THE Category of GTA
100% LIABILITY OF SERVICE TAX LIABILITY IS ON THE RECEPIENT OF SERVICE, IT DOES NOT MATTER IF GTA IS COMPANY OR INDIVIDUAL OR HUF OR FIRM ANY THING
PL CLARIFY THIS POINT IF 100% LIABILITY IS ON THE RECEPIENT THEN HOW YOU ARE SAYING PROIVDER WILL CHARGE AND DEPOSIT SERVICE TAX
I THINK ONE OF THE MAIN BASIC RULE I AM NOT PICKING
IF POSSIBLE DO GIVE BASIC PRINCIPLE OF REVERSE CHARGE
PL MENTION CATEGORY WISE FOR EACH OF SERVICE ON WHICH REVERSE CHARGE IS APPLICABLE
I.E.
GTA(SERVICE PROVIDER) SERVICE RECEPNT
COMPANY COMPANY
INDIVIDUAL INDIVIDUAL
HUF HUF
FIRM FIRM
MANPOWER AGENCY
SERVICE PROVIDER SERVICE RECEPIENT
COMPANY COMPANY
INDIVIDUAL INDIVIDUAL
HUF HUF
FIRM FIRM
THANKS IN ADVANCE
03 February 2014
You are right. Under the new reverse charge mechanism, in respect of following 3 services,
a) Rent – a – cab service
b) Manpower power supply service
c) Works Contract service
the reverse charge will be applicable only if, the service provider of these 3 services, is an Individual or HUF or Proprietary or partnership firm or AOP and the service receiver is a Company registered under Companies Act, 1956.
GTA service was also put under this category in the budget proposal, but due to demonstration and strike by the transporters, it was kept out and full service tax is payable by service recipient if the recipient is any factory, any society, any co-operative society, any dealer of excisable goods, who is registered under the Central Excise Act, any body corporate, or any partnership firm.
a) Rent – a – cab service
b) Manpower power supply service
c) Works Contract service
the reverse charge will be applicable only if, the service provider of these 3 services, is an Individual or HUF or Proprietary or partnership firm or AOP and the service receiver is a Company registered under Companies Act, 1956.
GTA service was also put under this category in the budget proposal, but due to demonstration and strike by the transporters, it was kept out and full service tax is payable by service recipient if the recipient is any factory, any society, any co-operative society, any dealer of excisable goods, who is registered under the Central Excise Act, any body corporate, or any partnership firm.
03 February 2014
THANK YOU
I AM UNDERSTANDING LITTLE BIT NOW
ANOTHER QUESTION THAT IS ARISING IN MY MIND IS
WE ARE A PUBLIC LIMITED COMPANY.
NOW WE RECEIVE AUDIT FEE BILL FROM AUDITORS EVERY YEAR
SUPPOSE THE FEES IS 100000 RS.
ANSWER THE QUESTION FOR TWO OPTIONS
1. Auditors are PARTENERSHIP FIRM
2. Auditors are PVT LTD. COMpany
now as per my understanding whole service tax liability of Rs. 12360/- will be borne by our company.
Auditors will not/can not charge service tax in their invoice
pl confirm/rectify my understanding
thanks
I AM UNDERSTANDING LITTLE BIT NOW
ANOTHER QUESTION THAT IS ARISING IN MY MIND IS
WE ARE A PUBLIC LIMITED COMPANY.
NOW WE RECEIVE AUDIT FEE BILL FROM AUDITORS EVERY YEAR
SUPPOSE THE FEES IS 100000 RS.
ANSWER THE QUESTION FOR TWO OPTIONS
1. Auditors are PARTENERSHIP FIRM
2. Auditors are PVT LTD. COMpany
now as per my understanding whole service tax liability of Rs. 12360/- will be borne by our company.
Auditors will not/can not charge service tax in their invoice
pl confirm/rectify my understanding
thanks
03 February 2014
The audit fee + service tax is to be paid by you fully to the auditor. Payment to CA is not covered under RCM, but payment to advocate is covered.
03 February 2014
For more information go to link : https://www.caclubindia.com/articles/service-tax-reverse-charge-18466.asp
03 February 2014
i have got abatement rate charge of service tax
in the works contract category
one of sub category is
original work
reverse charge of service tax is applicable on 40% i.e. 4.944%
now in the chart there is one condition for service provider for this reverse charge mechanism to be applicable
that is
service provider should not have availed cenvet credit on inputs
what does this cenvat credit mean
whether it means credit of Excise/Service tax
or only service tax
how will recepient of service know whether provider has availed cenvat credit or not.
pl clarify my doubts
i have got abatement rate charge of service tax
in the works contract category
one of sub category is
original work
reverse charge of service tax is applicable on 40% i.e. 4.944%
now in the chart there is one condition for service provider for this reverse charge mechanism to be applicable
that is
service provider should not have availed cenvet credit on inputs
what does this cenvat credit mean
whether it means credit of Excise/Service tax
or only service tax
how will recepient of service know whether provider has availed cenvat credit or not.
pl clarify my doubts
03 February 2014
In such case, Cenvat credit of input services and capital goods is available. Cenvat credit of excise duty on goods, the property of which is transferred is not available. Cenvat credit of other inputs (like consumables) is available
03 February 2014
i have not understood anything from this reply
pl explain in simple examples
what is rationale behind saying service provider should not have availed cenvat credit
pl explain in simple examples
what is rationale behind saying service provider should not have availed cenvat credit
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