Dear All,
One of my client (Trust) has received a work contract invoice for Rs. 15 lacs, Now I would like to know whether my client is liable to pay S.T on Reverse charge basis.
He is not registered with S.T dept. so whether he should get registered himself and if yes under which catagery and how much will be the S.T amount to be paid by him
And what will be situtation if the client is other than a trust.
Dear Sir,
Provisions of Reverse charge on Works contract service will apply only when service provider is Individual, HUF, proprietary, or partnership firm, AOP located in taxable territory and service reciever is a business entity incorporated as body corporate located in taxable territory.
The trusts having perpetual succession and a common seal with separate legal entity will only be considered as body corporate. Other than this( like charitable trust ) will not be considered as body corporate.
Therefore the liability to pay service tax will come on service reciever only if he is a body corporate and he need to get himself registered under works contract service.
The service reciever needs to pay service tax on 50% of the total value @ 12.36%
Regards
SKAA & Associates
New Delhi
CA Inter
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Triveni Turbine Limited
Bengaluru
CA
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R P S K & Associates
Nashik
CA Inter
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