Director's remuneration
This query is : Resolved
14 August 2012
Pls clarify us regarding the service tax liability on director's remuneration as per the recent notification issued by the service tax department.
14 August 2012
Remuneration to Whole Time Directors is not taxable.
Remuneration to non-executive directors who are not employee of the company is taxable
SImple Check: If TDS is deducted under Sec 192A then no service tax. If TDS is deducted under Section 194J then service tax payable.
Further reverse charge mechanism applies. In that case whole of the service tax shall be paid by the company directly to the government.
Remuneration to non-executive directors who are not employee of the company is taxable
SImple Check: If TDS is deducted under Sec 192A then no service tax. If TDS is deducted under Section 194J then service tax payable.
Further reverse charge mechanism applies. In that case whole of the service tax shall be paid by the company directly to the government.
14 August 2012
According to the notification, it says "in respect of services provided or agreed to be provided by a director of a company to the said company" so, now the liability is shifted to the Company under reverse charge with effect from 7th August.
Now the question is who are all covered? whether MD/ED/WTD (Whole time director) are included?
Though there is no clarity, in my opinion, only non-executive directors are covered in the said notn 45/2012.
Now the question is who are all covered? whether MD/ED/WTD (Whole time director) are included?
Though there is no clarity, in my opinion, only non-executive directors are covered in the said notn 45/2012.
15 August 2012
but sir how can say that it is applicable only on the non executive director because there is no clarity in that notification. It contains only the word director, that means all the directors should be included.
16 August 2012
Dear Sourabh,
The Law is very clear. Section 66B(44) defines the meaning of "service" and according to which a provision of service by an employee to the employer in the course of or in relation to his employment is not covered under the definition of the word service for the purpose of service tax.
The Directors who are employees of the Company and receiving any remuneration with respect to their service as an employee of the Company is not taxable under Service Tax.
The Company is liable to pay service tax on the amount paid by it to Directors not in their capacity as employee, as reverse charge mechanism
The Law is very clear. Section 66B(44) defines the meaning of "service" and according to which a provision of service by an employee to the employer in the course of or in relation to his employment is not covered under the definition of the word service for the purpose of service tax.
The Directors who are employees of the Company and receiving any remuneration with respect to their service as an employee of the Company is not taxable under Service Tax.
The Company is liable to pay service tax on the amount paid by it to Directors not in their capacity as employee, as reverse charge mechanism
16 August 2012
Dear Sourabh,
The Law is very clear. Section 66B(44) defines the meaning of "service" and according to which a provision of service by an employee to the employer in the course of or in relation to his employment is not covered under the definition of the word service for the purpose of service tax.
The Directors who are employees of the Company and receiving any remuneration with respect to their service as an employee of the Company is not taxable under Service Tax.
The Company is liable to pay service tax on the amount paid by it to Directors not in their capacity as employee, as reverse charge mechanism
The Law is very clear. Section 66B(44) defines the meaning of "service" and according to which a provision of service by an employee to the employer in the course of or in relation to his employment is not covered under the definition of the word service for the purpose of service tax.
The Directors who are employees of the Company and receiving any remuneration with respect to their service as an employee of the Company is not taxable under Service Tax.
The Company is liable to pay service tax on the amount paid by it to Directors not in their capacity as employee, as reverse charge mechanism
Message likes :
1 times
16 August 2012
Dear All,
Kindly see the Circular issued by Ministry of Corporate Affairs, vide General Circular No.24/2012 dt 09.08.2012 F.No.14/33/2012-CL VII. This circular clears all your doubts please. My reply coincides with the circular. Kindly go thro and reply.
Kindly see the Circular issued by Ministry of Corporate Affairs, vide General Circular No.24/2012 dt 09.08.2012 F.No.14/33/2012-CL VII. This circular clears all your doubts please. My reply coincides with the circular. Kindly go thro and reply.
Message likes :
1 times
16 August 2012
Thank you very much Rengaraj sir and suresh sir. Circular no. given by rengaraj sir clears all doubt regarding the director's remuneration taxability under service tax.
Rengaraj sir Just give me one more favour. I have searched this circular on service tax website where I have not found this circular but found on the taxmann site by the help of the google.
So please tell me where from I can see this general circular directly where department publish it.
Rengaraj sir Just give me one more favour. I have searched this circular on service tax website where I have not found this circular but found on the taxmann site by the help of the google.
So please tell me where from I can see this general circular directly where department publish it.
16 August 2012
Thanks to all. I think this query is resolved now. Sir I have found this circular on mca website.
16 August 2012
This Circular is issued by Ministry of Corporate Affairs and not by CBEC. Pls. go through mca.gov.in
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Post Office RD Interest
- Building and other construction workers welfare cess act 1996
- Bank Accounts in Balance Sheet for ITR 3
- ITR validation error - Balance sheet is not filled
- ITR 3 FILING OF AN INDIVIDUAL (PARTNER IN A PARTNERSHIP fIRM)
- Annual return of gst limit
- Eway bill for machinery reparing
- TDS ON CASH WITHDRAWALS...
- Form 10BD Filling
- Registration as Authorised Representative of minor
- Change the gender in the registration of icai
- Lift replacement entries in housing society
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- Difference in tax comparison report
- Gst invoice numbering and delivery challan numbering
- Sales amount in Gstr1
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
