Sandesh Shetty (student) (24 Points)
20 August 2013Can a Pvt ltd company claim input on service tax paid under reverse mechanism.
I mean company will pay 50% of service tax to the contractor. and it will remit balance 50% directly to the govt. My question is whether it can claim input of amount directly remitted to the govt.
satya
(Executive Excise)
(1839 Points)
Replied 20 August 2013
First of all Reverse Charge Mechanism does not applicable to PVT LTD and LTD companies.
Please check once again your querry?
Amith
(CA final & CS Professional)
(63 Points)
Replied 20 August 2013
Dear Mr Sathya pls make sure yourself before guiding others,
Reverse Charge Mechanism is applicable to those Companies which are formed under "Companies Act of 1956, whether it might be public ltd or Pvt Ltd Co...
As Far referring to Mr. Sandesh querry a pvt Ltd Co,. can claim the input credit.. (limit is 50%)
Please find the Attached pdf file to solve your querry in detail.
Thank you.
satya
(Executive Excise)
(1839 Points)
Replied 20 August 2013
Dear Amith ji,
I am not concentrated on claim of ST paid portion sir.
now I am clarifying clearly;
if services provider is a company then RCM (partial payment) not applicable full portion of ST has to bear that PVT LTD OR LTD company only.
if a service provider is a individual or huf or AOP then only ST payment partial applicable.
dear sandesh,
to claim ST as CENVAT CREDIT
50% of ST under WCS is eligible on the strength of Service Provider bill, remain 50% of ST under WCS is eligible on the strength of GAR7 challan which is paid by you.
Prabhat Kumar
(Advocate & Consultant)
(1912 Points)
Replied 21 August 2013
Cenvat credit can only be taken by the Service Provider as per rule(3) 1 of the Cenvat Credit Rules,2004.But being recipient of Service you can avail the credit of the tax paid under reverse charge method on the basis of tax payment challan subject to the basic condition that the same is used or utilsed in your activity.
KRS KHATI
(BM)
(24 Points)
Replied 15 January 2014
kumar hattanna
(Officer - Excise)
(525 Points)
Replied 17 January 2014
Service tax reverse charge mechanism is applicable only for Company, where company register under companies’ act 1956.
Case-1
Where in case of service receiver is a Individual or HUF RCM is Not Applicable. 100% ST Need to borne by the Service Provider.
Case-2
Where in case of service receiver is a Company and service provider is a Individual or HUF, RCM is applicable.
Case-3
Where in case of Individual and HFF is availing RCM is not entitled take input credit.
Lakshman
(Director)
(30 Points)
Replied 12 March 2015
I am from consulting firm and i do place candidates as per the client reqirements and i do raise a bill off 8.33 % of the candidate CTC if gets placed. Now i am not crossing the limit every year .( turnover is not crossing the limits then surely Service Tax is not applicable. And now Service tax limit is extented to 15 Lakhs .) Note : If the aggregate value does not exceed the limit in that Financial year , then the Service Provider need not pay any service tax. Only if that Limit exceeds, he should apply for service tax number and charge the service tax to the customers he is servicing. But here my client or the service receiver says they are Pvt Ltd company and so they have necessity to pay service tax for my bill amount if it is applicable or not. So he is deducting 25% from my bill amount which ever i raise. I want to know without service tax number how can the service receiver deduct the service tax. And only if it is applicable they have to see in which clause the service provided comes and accordingly they have to pay the service tax to the service provider and then the service provider should get the payment from the service receiver and then pay to the government through his service tax number. Right ?
help me on this issue ? Clarify pls
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