Reverse charge mechanism
Querist : Anonymous
I need to pay royalty charges to a statutory body , who shall pay the service tax under tax under reverse charge mechanism . we or the statutory body ? If it is we who need to pay service tax what is the percentage of payment ?
Querist : Anonymous
Querist : Anonymous
Please note:
1.why is royalty taxable:As per Section 66E(c).
2.When is reverse charge applicable:When the service provider ( in your case the statutory body) is located in a non-taxable territory and service receiver( that is you) are located in a taxable territory.
Refference:Point (B) Notification No.30/2012.
3.If the statutory body is located in India in taxable territory then you just need to pay the invoice value inclusive of service tax to that statutory body and not to the service tax authority.
Hope this helps.
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