Service tax - reverse charge

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anil kumar

B.Com

26 Points Posted on 19 September 2013

Dear Sir,

I just want to confirm under reverse charges service tax on security service is partly payable by service receiver but if security service company charged full tax ( 12.36%) & deposted then what will be service receiver libility

In vehicle hiring for passangers if service provider services are not taxable & not registered with department then what is the libility of service receiver

if in both conditions service provider is lible then how to change ST-2 & under whitch category weather in other service or services above mentioned.

Replies (3)

CA girl

Article Trainee-CA Final

857 Points Posted on 19 September 2013

Hey, under reverse charge the liability of service receiver and the service provider is independent,So:

1.The service provider for security services should charge only 25% of 12.36% st in the invoice, even if he collects the full st and pays it to the gov. the service receivers' liability will not be absolved... the service receiver should remit 75% of the st to the gov from his side. So if they charge full st...deduct 75% and pay only the balance amount.

2. it does not matter whether the service provider has obtained the relevant registrations or not...the service receiver should pay his share of service tax liability under reverse charge.

anil kumar

B.Com

26 Points Posted on 19 September 2013

Mam, then vehicle used for passanger how much service we have to pay

CA Amar kant kushwaha

Consultant

51 Points Posted on 19 September 2013

Dear Mr. Anil,

You have to service tax for your part i.e. 40% of total tax. It will be 4.94% including EC and SHEC on the service of Renting or Hiring Motor Vehicle under reverse charge.

Further, in relation to your previous query, please take care in case of security service, If Service provider is a registered company than Reverse charge mechanism will not be applicable. please check in your case.