DEPOSIT OF SERVICE TAX

[S.C. WADHWA]

ABC Pvt. Ltd. a company registered in India want to pay ₹ 600000/- to a company in Mauritus for professional services rendered by it towards formation of a new company, appointment of directors, company secretary.

Query is:

Whether ABC is required to deposit service tax on recipient basis. If yes, at what rate.

[kulwant singh khalsa]

you need to pay @12.36%

further there are no abatement or exemption

[YAGAY andSUN]

Dear S.C.Wadhwa,

Under Rule 3 of the POPS read with Notification No. 30/2012-ST/20-06-2012 w.e.f. 01-07-2012 as amended from time to time, you are under obligation to pay service tax @ 12.36% on the gross value of the amount which is required to be paid to your counter part. Further, there is no abatement or exemption is associated with this notification. This service tax amount is required to be paid through e-payment in cash(GAR-7 challan).

Further, you may also avail the CENVAT credit after following the prescribed provisions of the CENVAT credit Rules, 2004.

Regards,

YAGAY and SUN

(Management and Indirect Tax Consultants)

[Mahir S]

Yes, deposit the service tax at 12.36% and thereafter avail cenvat credit for the tax paid.

AI Summary

Indian Company Must Pay 12.36% Service Tax on Professional Fees to Mauritius Firm, No Exemptions or Abatements Available. ABC Pvt. Ltd., an Indian company, plans to pay 600,000 to a company in Mauritius for professional services related to forming a new company and appointing directors and a company secretary. The query is whether ABC must deposit service tax on a recipient basis and at what rate. The responses confirm that ABC is required to pay service tax at a rate of 12.36% on the gross amount, with no abatement or exemption available. The tax must be paid through e-payment, and CENVAT credit can be availed following the prescribed rules.