Sandeep Ahuja & Co.

Established in the year 1986, we are a leading chartered accountancy firm based in Delhi & NCR rendering comprehensive professional services which include statutory audit, internal audit, direct tax, transfer pricing, GST, bank audit, propriety audit, cost accounting, internal financial controls and risk advisory.

Wednesday, April 29, 2015

Full & Partial Reverse Charge at a Glance for Fin Year 15-16

Reverse Charge and Partial Reverse Charge in Service Tax for Fin. Year 15-16 amended {Notification No.7/2015-Service Tax, Dated- 1st March, 2015}
The Reverse and Partial Reverse Mechanism of Service tax is amended and here under given at a glance how Full and Partial Reverse Charge Mechanism is working wef 01.04.2015. The extent of service tax payable by the Service provider and any other person other than the service provider (Service Recipient or any other person) liable for paying service tax for the taxable services received can be divided into two categories:
A. 50% to be paid by the person providing service and 50% by any person liable for paying service tax other than the service provider:-
a) Services provided or agreed to be provided by way of renting of a passenger vehicle on non abated value to any person not engaged in the similar business by individual, HUF, firm or AOP to Body Corporate. (Revised w.e.f 01.10.2014)
b) Services provided or agreed to be provided in service portion in execution of works contract by individual, HUF, firm or AOP to Body Corporate.

B. 100% to be paid by any person liable for paying service tax other than the service provider.

100 % service tax under reverse charge mechanism is to be paid by any person liable to pay tax other than the service provider.
1. Services by an insurance agent to any person in insurance business.
1A. Services by a recovery agent to a banking company or Non banking financial Company.(Effective from 01.04.2015)
1B.  Services by a mutual fund agent to a mutual fund or asset management company. (Effective from 01.04.2015)
1C. Services by a selling or marketing agent of lottery tickets to a lottery distributor or selling agent.
2. By a goods transport agency for transportation of goods by road to Excise Registered Dealer.
3. By way of sponsorship to anybody corporate or partnership firm.
4. By an arbitral tribunal to any Business entity.
5. By individual advocate or a firm of advocates by way of legal services to any Business entity.
5A. By a director of a company or a body corporate to the said company or the body corporate.
6.By Govt or local authority excluding,- (1) renting of immovable property, and (2) services specifically  excluded  in section 66D to any Business Entity.
7(a). By way of renting of a  passenger  vehicle on abated value to any person who is not engaged in the similar business by individual, HUF, firm or AOP to Body Corporate.
 (b) 50%-50% sharing between Service provider and Service Recipient of Non Abated ( Person liable for service tax Other than Service provider  as described in A (a) above 
8. 50%-50% sharing between Service provider and Service Recipient Works Contract ( Person liable for service tax Other than Service provider  as described in A (b) above
9. By way of supply of manpower for any purpose or security services by individual, HUF, firm or AOP to Body Corporate.
10. Taxable services by any person who is located in a non-taxable territory and received by any person located in the taxable territory.
11. By a person involving an aggregator in any manner to any Business Entity. (Effective from 01.03.2015)


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