Service Tax on reverse charge method - reg.

[vinay wakde]

We have been provided services by Manpower Recruitment Agency during August,12.

Kindly let us know whether  we (Service recipient) have to pay Service Tax (50%) under Reverse charge mechanism.

Regards,

VINAY

 

 

 

[YAGAY andSUN]

If the service provider is Privat Ltd. or Limited company, then, service provider will charge 100% servcie tax from you otherwise in any other situation liability would be 50% of each party.

[SUMEDH AYARE]

SERVICE RECIPIENT HAVE TO PAY  SERVICE TAX @ 75% UNDER REVERSE CHARGE MECHANISM.

 

SUMEDH

[YAGAY andSUN]

Agreed that it gona be 75%.

AI Summary

Reverse charge liability: conflicting advisory views on allocation of service tax burden between recipient and manpower agency. The query asks whether the service recipient must pay a portion of service tax under the Reverse Charge Mechanism for manpower recruitment services. One advisory view says if the provider is a private limited or limited company the provider will charge full service tax to the recipient; otherwise liability is split 50% each. An alternative advisory view contends the recipient must pay 75% under reverse charge, and a participant agreed with that position.