Service tax registration - reg....

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 August 2013 Dear Friend,

My client (Proprietor Concern) is service receiver on the basis of getting service on transport of goods by road for the amount of Rs.1,00,000/- in the previous year. He is not involved in any other Service.Please tell me, Whether he is compulsory to Service Tax Registration or not?

And if service received for Rs.11,00,000?

Sumit Grover

Sumit Grover (Expert)
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27 August 2013 Yes....In case of service tax payable by service receiver under reverse charge mechanism, no threshold limit of Rs. 10 Lacs is allowed.....Service tax is payable from Re. 1 itself......
Hence, registration is required compulsorily.

Querist : Anonymous

Querist : Anonymous (Querist)

28 August 2013 Thank you Mr. Sumit Grover. But for GTA, only specified person (i.e., Service Receiver) only compulsory to pay service tax. Please clarify me under reverse charge mechanism. It doesn't cover individual.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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25 July 2025 Great question! Let me clarify the **Service Tax registration requirement for service receivers under Reverse Charge Mechanism (RCM), specifically for Goods Transport Agency (GTA) services**:

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### 1. **Reverse Charge Mechanism (RCM) Basics**

* Under RCM, the **recipient of certain specified services** is liable to pay Service Tax instead of the service provider.
* This shifts the tax payment responsibility from the provider to the receiver.

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### 2. **RCM Applicability on GTA Services**

* For **GTA services**, Service Tax under reverse charge is applicable only when the **service receiver is a 'specified person'**, which typically means:

* A **body corporate (company, LLP, etc.)**
* A **partnership firm**
* A **body of individuals** or **any entity** other than an individual or Hindu Undivided Family (HUF)

* **Individuals and HUFs are generally exempted from paying Service Tax under RCM on GTA services**.

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### 3. **Registration Requirement**

* If the **service receiver is a specified person (corporate, firm, etc.)**, **there is no threshold limit** under RCM — registration and tax payment is compulsory from the first rupee of service received.

* If the **service receiver is an individual or HUF**, no registration or tax payment is required under RCM for GTA services, regardless of the amount.

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### 4. **Your Client’s Case**

| Service Receiver Type | Amount of Service Received | Registration Required? | Tax Payment Required? |
| ----------------------- | ----------------------------- | ---------------------- | --------------------- |
| Proprietor (Individual) | Rs. 1,00,000 or Rs. 11,00,000 | **No** | **No** |
| Corporate / Firm | Any amount | **Yes** | **Yes** |

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### 5. **Summary**

* Since your client is a **Proprietor (an individual)**, **RCM on GTA services does NOT apply**.
* Therefore, **no Service Tax registration or payment under RCM is needed**, no matter the amount.
* However, if your client was a company or firm, then registration and tax payment under RCM is mandatory.

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If you want, I can help prepare a summary note or reference from the Service Tax notifications to support this position for your client. Would that be useful?

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