St on commission income
This query is : Resolved
01 December 2015
my income is general insurance commission . all transactions are online also shown in AS 26 form and im claimed tds in return .in current year my commission income cross 10 lac rs.i want to know what are the procedure to be followed in respect service tax in this case or whether any arrangement possible.
Amol S Joglekar
(Expert)
01 December 2015
Service tax is required to be paid by you. Get yourself registered with service tax and pay the tax.
Suresh Ramaswamy
(Expert)
01 December 2015
You are providing services as a general insurance agent. As per the provisions of Service Tax Notification 30 / 2012 dated 20th June 2012
Percentage of service tax payable by the person providing service of insurance agent to a person carrying on business of insurance the following applies:
"Percentage of service tax payable by the person receiving the service in respect of services provided or agreed to be provided by an insurance agent to any person carrying on insurance business 100%"
Thus under Reverse Charge Mechanism, the service recipient i.e. the insurance company will be liable to pay service tax on the commission paid to you.
Since you are not liable for payment of service tax, you need not take registration with the Central Excise Authorities.
Percentage of service tax payable by the person providing service of insurance agent to a person carrying on business of insurance the following applies:
"Percentage of service tax payable by the person receiving the service in respect of services provided or agreed to be provided by an insurance agent to any person carrying on insurance business 100%"
Thus under Reverse Charge Mechanism, the service recipient i.e. the insurance company will be liable to pay service tax on the commission paid to you.
Since you are not liable for payment of service tax, you need not take registration with the Central Excise Authorities.
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