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Service tax on reverse charge mechanism basis

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Sivaraman A R

746 Points Posted on 15 February 2016

The service provider is charging 100% Service tax in bill, in respect of services where Service receiver is liable under RCM. Is it still obligatory on that part of Service receiver to pay ST directly to Government? If Service receiver pays ST to Service provider and if service provider did not pay it to Government, is Service receiver still liable?

Siva

Replies (4)

Govind Shah

CA Final

60 Points Posted on 16 February 2016

We are not liable to pay under RCM, if the SP has charged service tax on the invooice.

CA Prakash N

Head - Indirect Tax (GST & FTP)

331 Points Posted on 16 February 2016

Dear Siva,

Under Reverse charge or Joint charge, service recipient is solely liable for his part of payment. As SP is not paid, there is no option left for you other than recovering such ST amount from service provider and discharge the same along with applicable interest.

Guest

Posted on 16 February 2016

Dear siva, SR liability is separate from SP, It is not a matter whether the SP deposited the Service Tax or not. But SR has to discharge his liability on his part. And he can take his money of service tax from SP which he is charged on invoice....