TaxTMI 
TaxTMI 
I'm a freelancer Immigration Consultant and I get my Study Visa cases processed through one Immigration Company on profit sharing basis. The part of the commission that they receive from the College abroad is given to me. The company deducts TDS @ 10% and Service Tax @12.36% from my Commission, is this the right thing to do? Am I liable to pay Service Tax also as the commission is less than one lakh.
Service Tax on Commission
14 Sep 2014 
3 Replies 
6475 Views Asked by
Guest 
Service tax liability depends on place of provision and provider-recipient status; recipient cannot claim threshold relief.
Liability for service tax on commission depends on identification of service provider and recipient and the place of provision of services. If the company is outside the taxable territory, no service tax arises; if inside, the place of provision is the recipient's location and privity of contract and flow of consideration determine whether the consultant or the company bears tax. The recipient cannot claim the turnover threshold, service tax should generally be collected by the provider from the recipient, and TDS must not be deducted on the service tax component. (AI Summary)
Liability for service tax on commission depends on identification of service provider and recipient and the place of provision of services. If the company is outside the taxable territory, no service tax arises; if inside, the place of provision is the recipient's location and privity of contract and flow of consideration determine whether the consultant or the company bears tax. The recipient cannot claim the turnover threshold, service tax should generally be collected by the provider from the recipient, and TDS must not be deducted on the service tax component. (AI Summary)