Service Tax Payment Under Reversed mechanism Charge

[Guest]

Sir,

we have paid service tax under reversed mechanism charge on Legal Service , Man Power Work Contract , Director Sitting Fee etc.

my query is:

if we made any advance payment to any contractor who supply us manpower or we made advance payment to an advocate,

is service tax applicable on advance payment?

if service tax is applicable on advance payment then, when we take CENVAT Credit of  Service Tax Paid amount?

Regards,

Rahul Patel

AI Summary

Service Tax on Advance Payments Explained: Reverse Charge Mechanism, CENVAT Credit on Manpower Services, Finance Act 1994 A discussion on a forum involves queries about service tax under the reverse charge mechanism, specifically regarding advance payments to service providers like manpower contractors and advocates. The original poster inquires whether service tax applies to advance payments and when CENVAT credit can be availed. Responses clarify that service tax is payable on advance payments as per the Finance Act, 1994, and CENVAT credit can be availed post-service completion or invoice issuance. Calculations for service tax liability on manpower services are provided, and it is confirmed that CENVAT credit is permissible on advance payments.