I want to know whether TDS to be deducted on service tax amount which is required to pay under reverse charge / partial reverse charge mechanism. Please give necessary notification / clarification in this regard.
Tnks in advance.
I want to know whether TDS to be deducted on service tax amount which is required to pay under reverse charge / partial reverse charge mechanism. Please give necessary notification / clarification in this regard.
Tnks in advance.
A (an individual) provides services to XYZ Pvt. Ltd. in relation to renting of motor vehicles.
| Particular | Abatement |
| Name of service | Hiring of motor vehicles designed to carry passenger. |
| Invoice value | Rs. 10000 |
| Less: Abatement 60% | Rs. 6000 |
| S.tax payable on | Rs. 4000 |
| Service tax amount | Rs. 494 |
| S.provider liable for s.tax | NIL |
| S.receiver liable for s.tax | Rs. 494 |
Now, XYZ ltd. has to deduct TDS on Rs. 10,000 only or considering s.tax paid by them to government directly Rs. 494 also consider for deduction of TDS? (i.e. Rs. 10494)
This case covered under 194C (contract) and not particular 194 I (rent) - please reply in the given contests.
As per my opinion tds is to be deducted always on gross amt (not considering service tax amt) whether it is normal case or RCM case.
https://www.eicbma.com/circulars/Cir-01-2014-130114.pdf
No TDS is required to be made on Service Tax Portion if Invoice specifies the amount of Service Tax Separately. [Refer Notification 1/2014]
If TDS amount is mentioned the invoice separately then it is irrelevant whether ST is payble under Reverse Charge or not. Hence No TDS is required on ST amount.
Naveen Fintech Pvt Ltd
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Gupta Sachdeva & Co. Chartered Accountants
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