RCM TO PAY SERVICE TAX, Service Tax

[pravin bansal]

Dear Sir, I Am a Director of pvt ltd company and as per my balance sheet freight paid approx 2 LAKH but the bilty is allready paid by sender co. but freight charge to me in billing approx 10000 rs by company per bill what are the position in R C M in service tax to me

Posts / Replies

[KASTURI SETHI]

Dear Querist,

[Notification No. 9/2014-S.T., dated 11-7-2014] specifically provides that Service Tax will be payable by body corporate for the services provided by Director.Prior to this date , service tax for the services provided by Director to a Company was only payable by receiver of service.

Relevant extract of the above notification is appended below:

“(EE) in relation to service provided or agreed to be provided by a director of a company or a body corporate to the said company or the body corporate, the recipient of such service;”;

Now under RCM Service Tax on freight is to be paid by the person who pays (bears) the freight. Preference-wise position is as under:-

1. Consignor (if prices are FOR)

2. Consignee

3. GTA

In view of the above legal position, you are not liable to pay Service Tax on freight.

[pravin bansal]

Dear sir

I am a frenchise of motor cycle company in local area and receipt by services of motor vehicle and commission of R's approx one -three lakhs in financial year in 2014-15 to 2016-17 what is the apply exemption under service tax limit 10 lakhs

[KASTURI SETHI]

You are not eligible for threshold exemption limit of ₹ 10 lakhs as you are using brand name of another person. Read notification no.33/12-ST as amended. See explanation given below notification.