Reverse mechanism of service tax in simple term

Queries 810 views 1 replies
User Avatar

Accountant
295 Points Joined March 2010

Dear All Experts

Please expain what is Reverse Mechanism of Service tax in simple term.Please also explain reverse mechanism in two case below:-

1) My company trnsfer Material to oor branch company in different state by road transport .(We are paying Service tax on behalf of transporter).

2) Hire car and taxi on for going one place to other placewithin delhi.

Thanks and Regards,

Amit Singh

0 Reply Share Follow
On 14 August 2012 at 16:55 Report
Replies (1)
User Avatar

Sr. Manager
617 Points Joined April 2011

In very simple terms; Reverse Charge is where the service receiver pays service tax, instead of service provider collecting and paying it to the treasuery.

 

Car hire you have two options

1. the vendor bills you with 60% service tax and you pay the balance 40%

2. vendor claims abatment and does not charge you ST you pay 60%.

 

Reply
On 14 August 2012 at 18:01


CCI Pro

Leave a Reply

Post Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Recent Threads

More recent discussions | Post

Related Threads
Loading