04 July 2015
There is a work contract service (maintenance service of good) by service provider to service receiver in which reverse charge mechanism applicable? service provider raises bill of rs 25000 to service receiver service provider is exempted from service tax due to below the threshold limit.
now service receiver how to calculate and pay to service provider option 1 25000*70% = 17500*14%=2450*50%=1225 pay to service provider 25000-1225=23775 pay to govt 1225
option 2 pay to service provider 25000 pay to govt 1225
which option is correct? if nothing is mentioned in contract for rate to inclusive or exclusive then which option is correct?