Manpower Supply Service & Reverse Charge
PrintListen to this Article
ANALYSIS OF REVERSE CHARGE MECHANISM IN RESPECT OF MANPOWER SUPPLY SERVICES OR SECURITY SERVICES
(Before proceeding further please read the disclaimer at the bottom of this write up)
Now after introduction of negative list approach, in respect of above services, service tax is payable by both the service provider as well as services receiver. However it is not applicable in all cases. This article will clarify that when services tax is payable by both the service provider as well as services receiver and when it is payable by service provider only.
As per sub clause (v) of clause (I) of NN-30/2012 ST dated 20.06.2012 read with s.no. 8 of Table of NN-30/2012 ST dated 20.06.2012, we can conclude as under:
TABLE SHOWING EXTENT OF SERVICE TAX PAYABLE BY SERVICE PROVIDER AND SERVICE RECIVER:
|
S. NO. |
SERVICE PROVIDER |
SERVIVE RECEIVER |
EXTENT OF SERVICE TAX PAYABLE BY |
|
|
|
|
|
SERVICE PROVIDER |
SERVICE RECEIVER |
|
1 |
Any individual, HUF or partnership firm or association of persons |
DO |
100% |
NIL |
|
2 |
Any individual, HUF or partnership firm or association of persons |
Body Corporate |
25% |
75% |
|
3 |
Body Corporate |
Any individual, HUF or partnership firm or association of persons |
100% |
NIL |
|
4 |
Body Corporate |
Body Corporate |
100% |
NIL |
Thus it is clear from above table that only in one case 75% service tax is payable by service receiver and not in all cases i.e. when service provider is any individual etc and service receiver is body corporate.
RELEVANT DEFINITIONS
1. “supply of manpower”means supply of manpower, temporarily or otherwise, to another person to work under his superintendence or control.’
2. "security services"means services relating to the security of any property, whether movable or immovable, or of any person, in any manner and includes the services of investigation, detection or verification, of any fact or activity;"
I hope above article is useful for you. Your valuable feedback in respect of same would be highly appreciated.
(Disclaimer: The above analysis has been drafted as per various provisions of Finance Act 1994, and notifications and circulars issued thereunder. The analysis may not be entirely correct for reader to reader due to different interpretations by different readers. The readers are advised to take into the consideration the prevailing legal position before acting on any of the comments in this reply.We shall not be responsible for any loss caused based on this interpretation.)
With Warm Regards,
CA. Puneet Goyal
Mobile: 9211274295, 9711988362
Category : Service Tax | Comments : 1 | Hits : 13732
CENVAT CREDIT ON SET TOP BOX INTRODUCTION Service providers have at least a Telephone in their office. They are paying service tax on the telephone charges. The service tax on telephone charges becomes a part of the cost for the service provider. When he collects service tax from the customer it becomes tax on tax which increases the actual rate of tax payment. This phenomenon of tax on tax is called the cascading effect. The government does not want this to happen. The...
NO KRISHI KALYAN CESS ON DEBTORS AS ON 13th MAY’ 2016 (PART -2) Read more at: http://www.casansaar.com/article-submit.htmlThe enabling provisions for KRISHI KALYAN CESS (KKC) are contained in Chapter – VI of Finance Act’ 2016. As per the provisions, KKC shall be applicable at 0.5% on all taxable services and the proceeds of KKC would be exclusively used for financing initiatives relating to improvement of agriculture and welfare of farmers. The Cess will come into force with ...
As you are aware that the Finance Act, 2016 has increased the service tax rate to include a new cess, namely Krishi Kalyan Cess, which is applicable w.e.f. 01/06/2016. The effective rate of service tax for all new services provided after 01/06/2016 shall be as below: Service Tax ...
CENVAT CREDIT AVAILABLE VS CENVAT CREDIT TAKEN ALARMING AMENDMENT IN RULE 6(3) OF CENVAT CREDIT RULES (a) A manufacturer who manufactures two classes of goods namely:- Non exempted goods removed Exempted goods removed Or (b) a provider of output service who provides two classes of services, namely:- Non Exempted Services Exempted Services Shall follow any one of the following options applicable to him namely:- (i) pay an amount equal to 6% ...
Date : 19.03.2016 M/s. ABC LLP ( Service Provider ) M/s. XYZ Limited ( Service Recipient ) Ref: Service Tax on Works Contract and RCM Opinion Before giving opinion on the issues it will be useful to refer the questions related with this transaction. Assume ABC is LLP and XYZ Ltd is Body Corporate. ABC LLP is a sub contractor of XYZ Limited. XYZ Ltd sub contracted Works Contract work as well as Labor work also some time. Both partie...
Comments
Varun Kapoor
15-Jan-2013 , 05:06:49 amSir, PLEASE EXPLAIN DO WE STILL NEED TO DEPOSIT 75% SERVICE TAX UNDER REVERSE CHARGE MECHANISM AS WE DO IN CASE OF GOODS TRANSPORT AGENCY EVEN IF CENVAT CREDIT IS AVAILABLE WITH US.