Service tax - Mr. A sponsored a dance competition organized by ‘Taal Academy’, a dance school run by an individual. The dance competition was named as‘Mr. A’s Dance Show’ by ‘Taal Academy’. Who is liable to pay service tax in this case? Will your answer be different if ‘Taal Academy’ is run by a partnership firm? Answer - In case of taxable service provided or agreed to be provided by way of sponsorship to any body corporate or partnership firm located in the taxable territory, person liable to pay service tax is the person receiving such service. However, since in the given case sponsorship service is provided to an individual, the person liable to pay service tax will be service provideri.e., ‘Taal Academy’. Further, since the status of service receiver is relevant for determining as to who would pay service tax, status of service provider is immaterial. Therefore, as long as sponsorship service is rendered to an individual, service tax will be payable by service provider i.e., ‘Taal Academy’ irrespective of whether the same is run by an individual or a partnership firm. Join with us : facebook/groups/caultimates
Posted on: Fri, 26 Sep 2014 05:08:22 +0000
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