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Reverse charge machanism

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Querist : Anonymous

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Querist : Anonymous (Querist)
19 February 2013 M/s ABC has receive Legal service (advocate ) than M/s ABC is liable to pay service tax under reverse charge machanism @ 12.36 %

As per Input service defination he can also take SET OFF or not ??

19 February 2013 YES , ABC would be liable to pay tax under reverse charge (assuming turnover exceeds 10lac)

You can take cenvat credit of service tax paid

19 February 2013 As per Central Govt. Notification no 30-2012 and 33-2012 on Service Tax, it is evident that in case of services provided by individual advocates or a firm of advocates, the service recipient is liable under the reverse charge mechanism to pay 100% of the tax liability @ 12.36%. (irrespective of the turnover of the service recipient, refer http://www.servicetax.gov.in/notifications/notfns-2012/st33-2012.htm)

Further the recipient can claim Cenvat credit on the same.

I hope it suffices.



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Querist : Anonymous

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Querist : Anonymous (Querist)
19 February 2013 Thanks to Poonam & Nilesh

So, Indirctly M/s ABC Does't have to pay any service tax for legal service
they just have to show in the RETURN that they are liable to pay S.T. & they have taken SET OFF for that

Is it correct ??

20 February 2013 No, M/s ABC in this case will have to pay the Service tax and thereafter they can claim the credit for the same.


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Querist : Anonymous

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Querist : Anonymous (Querist)
20 February 2013 Thanks Poonam once again now

I would like to one more Question to You " Are the Pure Agent is Liable to pay Service tax "

17 August 2023 Yes, tax liability arises.



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