Service tax registration and input tax credit

This query is : Resolved

Ganpat (Querist)
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29 December 2012 Dear Sir

We are providing legal services. w.e.f 01/07/2012 these services are come under reverse charge mechanisam.hence the service receiver is liable to pay tax on these services.

Our value of services provided has exceeded the basic exemption limit of 10 lacs now should we have to get registered under service tax act.

another point is if the service receiver wants to avail cenvate tax credit for the service tax paid by it on reverse charge basis. is it necessary that our invoice should mention our service tax number. eventhough we are not liable to pay service tax.

CA Hiren Thakkar

CA Hiren Thakkar (Expert)
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29 December 2012 In case of service provider’s where 100% liabilities are lied on the service receiver, there is no liability on the service provider, in that case there is no need for the service provider to register with service tax authorities because no liability is accrue and arise on service provider. I think you need not to register for ST, since you have no tax liability to discharge.

However, so times service reciever insist for ST registration no of service provider becuase your their lack of knowledge. So, in that case, you may opt for voluntary registration. Then, you will have to comply with administrative requirements of ST like ST Returns etc...

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