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
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
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
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.
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
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
CAclubindia
