Reverse charge
This query is : Resolved
CA Ysil Karunai
(Querist)
16 October 2012
Dear Sir,
Please Consider the following issue:
A Ltd is engaged in supplying Manpower to B Ltd. A Ltd is new company and is enjoying exemption limit of Rs. 10 lakhs under service tax.
Hence, Invoice raised by A Ltd to B Ltd under Manpower supply service is without charging service tax on the basis of A Ltd was exempted
Query:
1. Whether B Ltd is liable to pay service tax under reverse charge mechanism even though service provider is exempted.
2. IF yes, whether B ltd is liable to pay only 75% or 100% under manpower supply service?
Please Consider the following issue:
A Ltd is engaged in supplying Manpower to B Ltd. A Ltd is new company and is enjoying exemption limit of Rs. 10 lakhs under service tax.
Hence, Invoice raised by A Ltd to B Ltd under Manpower supply service is without charging service tax on the basis of A Ltd was exempted
Query:
1. Whether B Ltd is liable to pay service tax under reverse charge mechanism even though service provider is exempted.
2. IF yes, whether B ltd is liable to pay only 75% or 100% under manpower supply service?
16 October 2012
No, Not required. The reverse charge is not applicable in case supply of manpower by a corporate(A ltd).
No liability for B Ltd
No liability for B Ltd
CA Ysil Karunai
(Querist)
16 October 2012
Thank you sir,
My Question was whether reverse charge is applicable for Service Receiver when service provider enjoying exemption limit of Rs. 10 lakhs by not charging service tax in his invoice, under such circumstances what is the obligation for service receiver under reverse charge mechanism
My Question was whether reverse charge is applicable for Service Receiver when service provider enjoying exemption limit of Rs. 10 lakhs by not charging service tax in his invoice, under such circumstances what is the obligation for service receiver under reverse charge mechanism
16 October 2012
The threshold limit is not applicable for service receivers under reverse charge, he should get registered and has to pay service tax from re.1(example) for specified services under Notification 30/2012 ST dated 20.06.2012.
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