Reverse Charge

[sampath Gopalakrishnan]

With respect to recent amendments to service tax laws, especially reverse charge mechanism in case of manpower supply, what will be the liability of the service recevier if the service provider's total turnover is less than 10 lakhs in the previous year i.e. there is no service tax liability from him

AI Summary

Reverse Charge Mechanism: Service Recipient Must Pay Service Tax for Manpower Supply Below 10 Lakhs Turnover Limit A query was raised regarding the service tax liability under the reverse charge mechanism for manpower supply services when the service provider's turnover is below 10 lakhs, exempting them from service tax. The response clarified that the service recipient cannot benefit from the threshold limit and must pay the service tax under the reverse charge mechanism. It was suggested to refer to paragraph 10.1.3 of the 'Taxation of Service: An Educational Guide' for further details.