Reverse charge on security services

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This query is : Resolved

Tara Jain (Querist)

13 August 2013 I want to know that if the service provider has already paid full amount of tax then whether the service receiver is also liable to pay the tax of his share?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

13 August 2013 Incase service provider paid the service tax 100% for the services covered under RCM, you can collect the copy of challan for the same and keep for your reference incase any query from department.

Further bills you have to pay the service tax to Govt.

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Tara Jain

Tara Jain (Querist)

14 August 2013 Ramesh Sir, can I know the section where related provision are made.

Tara Jain

Tara Jain (Querist)

14 August 2013 Thank You, Sir

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

14 August 2013 There is no specific provision stating that, how ever the payment of tax can be paid one time to government for one service, actual provision says that need to pay by reverse charge, but since your vendor paid fully you can collect the proof for the same and avoid the same in future transaction

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CA Suresh Jain

CA Suresh Jain (Expert)

15 August 2013 With due respect to Mr. Ramesh Krishnan, the service tax has to be paid by the receiver of service where RCM is applicable irrespective of the fact the full service tax is charged by the service provider.
Option available to you is that you deny the payment of service charges to service provider. The service provider can adjust the amount excess paid by him.

disclaimer- all answers are given as per the facts narrated by you. Answer may differ after study of full facts/statements/agreements etc. involved in the case

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