Service Tax on Directors Remuneration under reverse charge

[deepak kalambate]

Dear Sir,

We have a employee director & we are paying salary to him. Department is asking us to pay service tax on this under reverse charge

Pl let us know is there Board's clarification on this.

Pl advise

Regards,

Deepak R Kalambate

AI Summary

Service tax reverse charge on director services: companies liable when directors act other than as whole time employees.
Taxability depends on the director's capacity: services by a director acting as an employee are excluded from "services" and not taxable, supported by evidence of employee/whole time appointment; services by directors acting in a non employee, part time or professional capacity are taxable under the reverse charge mechanism, with the recipient company liable to pay service tax.