SERVICE TAX ON SALARY PAYMENT TO DIRECTORS

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..... SERVICE TAX ON SALARY PAYMENT TO DIRECTORS
Query (Issue) Started By: - M.S.SUHAS MUNDARAGI Dated:- 5-10-2015 Last Reply Date:- 2-11-2015 Service Tax
Got 5 Replies
Service Tax
WHETHER RCM APPLICABLE TO SUCH DIRECTORS ALSO WHO ARE FULL TIME EMPLOYEE OF A COMPANY. Reply By Rajagopalan Ranganathan: The Reply: Sir, According to Section 65B (44) (b) of Finance Act, 1994 "service&quo .....

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..... t; means any activity carried out by a person for another for consideration, and includes a declared service, but shall not include a provision of service by an employee to the employer in the course of or in relation to his employment. Therefore salary paid to Directors who are full time employee of the company will not attracts service tax. Reply By vijay kumar: The Reply: Even in respect of w .....

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..... hole time Directors, where the remuneration is paid in the course of employment, it is not taxable. However, if the Director renders any consultancy service or any other service to the company, for which he is compensated separately than the remuneration / salary, such service would be taxable. Reply By Ganeshan Kalyani: The Reply: Dear Vijay Kumar Ji, I feel that any service provided in the re .....

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..... lation of employer-employee would be exempted from service tax. How can a consultancy service be excluded from exemption. The compensation paid by employer to employee would be in the nature of salary. I doubt how salary in one hand and consultancy on other hand would mean to be different when the provider of service is an employee and receiver of service is employer. Please clarify my understandi .....

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..... ng. Reply By Mahir S: The Reply: Ganeshan ji, The Directors can be the employee of company and received salary and other perks but the amount paid in any form to Director is covered under the Remuneration to Director, except the payment made to him for his services rendered by him in his Professional capacity (such as providing consultancy etc. ) Reply By Ganeshan Kalyani: The Reply: Dear Mihi .....

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..... r sir, whether reverse charge is applicable for payment made to Director as professional fees though there is employer employee relationship.
Discussion Forum - Knowledge Sharing .....

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