Reverse Charge Mechanism

[Deepak Whorra]

Dear Experts,

If the service receiver for Security Services is a Partnership Firm, then is the reverse charge mechanism applicable.

The notification states if the the service receiver is a Company as per the companies act or a body corporate in any taxable region, the Reverse Charge mechanism will apply.

My confusion is over the words : Body Corporate being SEPERATELY MENTIONED FROM THE WORDS COMPANY UNDER THE COMPANIES ACT. WHAT DOES THAT MEAN / IMPLY...

WILL SOME EXPERT ENLIGHTEN ME AND OBLIGE. tHANK yOU

[Udaya Chandran]

Service tax on Security services is not applicable for Partnership firm under Reverse Charge Mechanism. Service receiver need to pay only 75% of ST and 25% will be paid by Service provider.

AI Summary

Reverse Charge Mechanism for security services excludes partnership firms; receiver bears majority of service tax liability. The Reverse Charge Mechanism for security services does not apply to partnership firms; the reply indicates the service receiver does not fall within the receiver-based reverse charge rule and the tax liability is allocated with the receiver paying the larger share and the provider paying the remainder.