Service provider provides Supply of man power service, Accordingly the service provider has to bear 25% of the service tax liability and service recipient has to bear 75% of the liability.
So,For eg : Value of service provided = Rs. 100 Service provider has to bear=3.09 (ie 25% of 12.36) Service recipient has to bear=9.27 (ie. 75% of 12.36) Now, if the service provider charged whole service tax to the service recipient. How much service tax can service recipient recover from service provider ?
07 April 2013
If the service receipient is any of the following:
any company formed or registered under the Companies Act, 1956 (1 of 1956) or a business entity registered as body corporate located in the taxable territory;
and the service provider is any one of the following:
Individual (prop ) /Partnership firm (registered or unregistered) /HUF
then service receipient should only pay to service provider service tax on 25% of the value of service provided. If service provider has charged service tax on 100% of the service provided then service receipient should deduct the excess service tax charged by the service provider and pay service tax on 75% value directly to Government.
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