St- additional services under reverse charge

I have a query. Does remuneration paid to WTD/MD/Executive Director for employment also is included here ? Or only sitting fees paid to part time director for attending board meetings and commission are being brought within service tax net under reverse charge mechanism.

Regards,

Any feedback..

REgards

@ Jyoti,

More clearification is also requried from department about your query, notification about servicer tax on services by director may issued by department soonly.

You can added me @ navinjainj @ gmail.com.

Navin Jee,

Department creating un-necessary hassle and problem for the corporates and making service tax provisions complex, worst and vigrous.

According to me, this notification applies only to non - executive directors.

As per the definition of service, services provided by an employee to the employer in the course of employment is excluded from the definition itself. Executive Directors / WTD / MD are generally in the rolls of the company and are employees of the company, and hence they donot fall under the definition of service itself. Hence service tax shall not be applicable to WTD / MD.

Hence, this notification is applicable only to such directors who are liable to service tax, i.e., non-executive or independent directors.

Originally posted by : CA Ganesh Karthik
	According to me, this notification applies only to non - executive directors.   AExecutive Directors / WTD / MD are generally in the rolls of the company and are employees of the company, and hence they donot fall under the definition of service itself.

True, there should be employer and employee relationship to escape Service tax liability. Now the issue is how to demonstrate that ? 

Primarily, I guess TDS deduction can be taken as one of the criteria.

If TDS is deducted under section 192,  and the Director offers his income to income tax under the head salaries, I guess thats sufficient to establish employer - employee relationship.

Dear Ganeshji,

I appreciate your reply but I have a query here.

Now section 194 J (1) (ba) is available where TDS is deducted for any remuneration or commission paid to DIRECTOR of the company from 01.07.2012 without any minimum cut off limit/amount @ 10% flat.

In this case, now we can not deduct TDS of director u/s 192.

Then what is to be done ?

With Regards.

Dear Neha,

As per the Section 194J (1) (ba),  "TDS has to be deducted on any remuneration or fees or commission by whatever name called, other than those on which tax is deductible under section 192, to a director of a company"

So, if the Director is in the Rolls of the company and TDS is deducted under Section 192, I dont think there should be any problem to prove that service tax is not applicable.