TaxTMI 
TaxTMI 
What is Forward charge mechanism under service tax ???
How is it different from RCM ???
Please suggest.
Forward charge mechanism
08 Nov 2016 
6 Replies 
9680 Views Asked by
Forward charge: service provider remits tax, while reverse charge makes recipient liable for notified services.
Forward charge makes the service provider liable to levy and remit service tax to the central government for services not under reverse charge. Reverse charge shifts liability to the service recipient for services notified by the government. Under GST, reverse charge may be retained to permit tax collection on services supplied from non taxable territories or foreign providers when the government cannot collect directly from the foreign supplier, thereby securing revenue and affecting compliance obligations. (AI Summary)
Forward charge makes the service provider liable to levy and remit service tax to the central government for services not under reverse charge. Reverse charge shifts liability to the service recipient for services notified by the government. Under GST, reverse charge may be retained to permit tax collection on services supplied from non taxable territories or foreign providers when the government cannot collect directly from the foreign supplier, thereby securing revenue and affecting compliance obligations. (AI Summary)