Under reverse charge mechanism, Service tax is paid by service recipient instead of service provider. [Notification 30/2012, 10/2014 read with rule 2(1)(d) of STR,1994] List of services on which reverse charge mechanism is applicable: a) Works contract services provided by individual, HUF, firm or AOP to body corporate. [50%-SP, 50%-SR] b) Manpower supply for any purposes or security services provided by individual, HUF, firm or AOP to body corporate. [25%-SP, 75%-SR] c) Services provided by individual advocate and Arbitral Tribunal to Business entity. d) Sponsorship provided to Body Corporate or Partnership firm. e) Services provided by GTA services to corporate, partnership firm (Tax paid by consignor or consignee whoever is paying the freight). f) Service provided by insurance agent to insurance companies. g) Services provided by a director of a company to a said company. h) Services provided from Non taxable territory to taxable territory. i) Providing renting of motor vehicle services to any person who is not in the similar line of business. [50%-SP, 50%-SR, if Service Provided avail CENVAT Credit] j) Support services provided by Government and Local Authority excluding renting of immovable property, postal, port, airport, railway services. Note: In all cases 100% of service tax amount is to be paid by service recipient. [except a, b and i cases mentioned above]
Posted on: Sun, 21 Dec 2014 16:58:11 +0000