adjustmen of excess royalty payment under reverse charge

[anish mital]

I am paying royalty to a foreign based company, on which I have discharged service tax under reverse charge basis, which is in excess of actual liability.Please tell me the detail procedure for adjustment.

[DR.MARIAPPAN GOVINDARAJAN]

The same may be adjusted in the subsequent payment. You have to inform about the details of the adjustments of excess to the Range Superintendent.

[Ganeshan Kalyani]

As per Rule 6 (3) of Service Tax Rules 1994 the excess payment of service tax can be adjusted in the liability of subsequent month.

AI Summary

Excess service tax paid under reverse charge can be adjusted against subsequent liability with Superintendent notified.
Excess service tax paid under the reverse charge mechanism can be carried forward and adjusted against the liability of a subsequent tax period, with the taxpayer required to inform the Range Superintendent of the details of such adjustment, consistent with the adjustment provision in the Service Tax Rules.