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Ssp exemption
Hi can anyone pls tel me whether the turnover earned under reverse charge mechanism is eligible for 10lakh exemption ? Should that be added for getting the aggregate value ?
Replies (6)
My question is from service provider's point of view.
Hello Amisha,
In case of reverse charge, service receiver has to pay service tax.
It is not the liability of service provider to pay tax thereon.
So, while calculating aggregate value, services provided under RCM should be ignored because SP is not liable to pay tax thereon.
However if it the case of Partial Reverse Charge like in case of Works Contract i.e. 50-50, the portion on which SP is liable to pay tax should be considered ignoring the portion on which he is not liable to pay tax.
So if the SP's taxable turnover is 900000 (excluding 200000 turnover of works contract) . , for the purpose of aggregate value calculation the turnover to be considered wil be - 900000 + 100000 (the amount on which he is liable to pay ST) . Am I correct ?
Yes.. Rs. 900000 (except wc) + Rs100000 (50% portion of wc).
SP will be liable to pay tax on amount exceeding Rs. 10 lakhs
Ok. Thank you so much for your prompt guidance .!!!
You are welcome. ^_^
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