Service tax reverse charge
MANOJ
(Querist) 20 May 2016
This query is : Resolved
Dear Sir
I have one query.
If nothing is amentioned in Contract , who is liable to bear Service Tax Reverse Charge.
Can Service Receiver deduct Service Tax from payment of Service Provider.
Pl advice
RAVI K GOUD
(Expert) 22 May 2016
Only the service provider has to remit the service tax to the department after collecting the service tax from the recipient of service as per the invoice raised.
If the service provider does not raise the ST in the Invoice, then the service recipient can add the service tax for the services if they fall in the given schedules and he can deduct ST and pay or remit to the department on behalf of the service provider.
Rajendra K Goyal
(Expert) 22 May 2016
Academic query, state material facts of the problem if any.
MANOJ
(Querist) 25 May 2016
Thanks
In our case , Purchase Officer who raise PO for works contract , mention in PO that all taxes to be borne by Vendor. Now on Works Contract receivers' Service Tax liability under Reverse Charge , is 7.25%.
Can we debit this amount to Supplier , as per terms of PO.
Pl guide.
RAVI K GOUD
(Expert) 26 May 2016
Instead of debiting, You can ask your supplier to change the invoice by incorporating ST to that effect and as per the new invoice you can make the payment.
T. Kalaiselvan, Advocate
(Expert) 27 May 2016
Well advised by experts above, you may follow the same or consult your auditor.
RAVI K GOUD
(Expert) 27 May 2016
Thank You Selvan Sir for your appreciation.
