Reverse charge mechanism
This query is : Resolved
04 December 2012
As per Point of Taxation rules, Rule 7 states that the tax liability of service recipient under reverse charge will arise on payment basis.
Query 1 : Service covered under partial reverse charge is provided in the month of june i.e on or before 01.07.2012 and the payment for the same services is made in the month of august by the service recipient.Whether service recipient is liable to pay service tax under reverse charge?
Query 1 : Service covered under partial reverse charge is provided in the month of june i.e on or before 01.07.2012 and the payment for the same services is made in the month of august by the service recipient.Whether service recipient is liable to pay service tax under reverse charge?
04 December 2012
AS far I am concerned., u will not liable., as you are paying the consideration for the work which has been initiated when it was not liable to tax.,
my doubt is whether., the service is liable to tax before the 1.7.2012
my doubt is whether., the service is liable to tax before the 1.7.2012
05 December 2012
In such cases since point of taxation of the service has already been determined and whole liability has been affixed before 1.7.2012, the new provisions will not apply. Merely because payments are being made after 1.7.2012 will not add any additional liability on the service receiver in respect of such services. Thus you as a service recipient shall not be liable under reverse charge for services provided prior to 1.7.2012.
05 December 2012
Thanks mate for the reply, but can you please help me with some reference to Notification or guidance note regarding this ?
05 December 2012
Please refer to the Guidance Notes issued by the CBEC on 20.6.2012
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