Service tax liability under reverse charge mechanism

[Guest]

Dear Sir,

We are a Pvt Ltd Company one individual provide service to us with material which is falls under works contract service.

Service provider not charge the service tax on his invoice due to any reason but we as a company we paid the service tax under reverse charge mechanism our % i.e 50 % .

My question is if service provider not charge the service tax on his invoice in that case as a compnay we are lible to pay the service on total service tax that is 50% of service receiver as well as service provider also ?

Regards

Swapneswar Muduli

AI Summary

Private Company Must Pay 50% Service Tax Under Reverse Charge for Works Contract Services, Experts Clarify. A private limited company inquired about its service tax liability under the reverse charge mechanism for works contract services. The service provider did not charge service tax on the invoice, prompting the company to question whether it must pay the full service tax. Experts clarified that the company is responsible for paying only its portion, 50%, of the service tax. The service provider's tax obligations are separate, and any issues regarding exemptions or non-payment are the concern of the service tax department. The concept of partial reverse charge aims to prevent tax evasion by ensuring both parties fulfill their respective liabilities.