We are paying Rs 65,000.00 Per Month to consultants on account of development of software consultancy for maintenance. Service tax is applicable but the service provider do not charge.
Please clarify following:
Are we liable to pay service Tax as service receiver?
If yeas . What will be percentage. Will it be under maintenance and repair As 70 percent ?
Regards
L.K.Chaturvedi
Software Development Services Not Liable for Reverse Charge Service Tax; CENVAT Credit Available Under VCES Rules A discussion on service tax liability for software development and consultancy expenses reveals that the service receiver is not liable to pay service tax under the reverse charge mechanism, as these services are not covered under the relevant notification. It is suggested that the service provider might be utilizing a threshold limit benefit. Additionally, it is clarified that CENVAT credit can be availed following the provisions of the VCES and CENVAT Credit Rules. Queries about availing CENVAT credit for past liabilities are addressed, confirming its availability under specific conditions. (AI Summary)
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