Service Tax: Reverse Charge Mechanism (R.C.M.) New Rates

1. This is glimpse of the Reverse Charge Mechanism (R.C.M.) [as amended from time to time] applicable from 01.04.2015.The following table shows such taxable services in which the extent of service tax payable thereon by the person who provides the service and the person who receives the service.
2. Effective rates of R.C.M. as applicable are stated considering the increased service tax rate from 12.36% to 14% w.e.f. 01/06/2015.

R.C.M. TABLE WITH EFFECTIVE RATE for F.Y. 2015-16

Sl.No	Description of a service	Service Tax payable by Service Provider (%)	Service Tax payable by Service Reciver (%)	Effective Rate of service tax payable by Service Provider		Effective Rate of service tax payable by  Service Reciver
				1st April 2015 TO 31st May 2015	From 1st June 2015	1st April 2015 TO 31st May 2015	From 1st June 2015
1	In respect of services provided or agreed to be provided by an insurance agent to any person carrying on insurance business	Nil	100%	0.00%	12.36%	0.00%	14.00%
1A	In respect of services provided or agreed to be provided by a recovery agent to a banking company or a financial institution or a non-banking financial company	Nil	100%	0.00%	12.36%	0.00%	14.00%
1B	In respect of services provided or agreed to be provided by a mutual fund agent or distributor, to a mutual fund or asset management company	Nil	100%	0.00%	12.36%	0.00%	14.00%
1C	In respect of service provided or agreed to be provided by a selling or marketing agent of lottery tickets to a lottery distributor or selling agent	Nil	100%	0.00%	12.36%	0.00%	14.00%
2	In respect of services provided or agreed to be provided by a goods transport agency in respect of transportation of goods by road to	Nil	100%	0.00%	3.708%	0.00%	4.20%
	Factory under the Factories Act,1948,
	Society under the Societies Registration Act,1860,
	Co-operative society,
	Dealer of excisable goods under th Central Excise Act, 1944,
	Any body corporate,
	Partnership firm including association of persons.
3	In respect of services provided or agreed to be provided by way of sponsorship to any body corporate or partnership firm located in the taxable territory	Nil	100%	0.00%	12.36%	0.00%	14.00%
4	In respect of services provided or agreed to be provided by an arbitral tribunal	Nil	100%	0.00%	12.36%	0.00%	14.00%
5	In respect of services provided or agreed to be provided by individual advocate or a firm of advocates by way of legal services	Nil	100%	0.00%	12.36%	0.00%	14.00%
5a	In respect of services provided or agreed to be provided by a director of a company or a body corporate to the said company or the body corporate	Nil	100%	0.00%	12.36%	0.00%	14.00%
*6	In respect of services provided or agreed to be provided by Government or local authority ‘by way of support services’ excluding,- (1) renting of immovable property, and (2) services specified in sub-clauses	Nil	100%	0.00%	12.36%	0.00%	14.00%
	(i) services by the Department of Posts by way of speed post, express parcel post, life insurance, and agency services provided to a person other than Government
	(ii) services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport
	(iii) transport of goods or passenger of clause (a) of section 66D of the Finance Act,1994
7	(a) in respect of services provided or agreed to be provided by way of renting of a motor vehicle (by individual,HUF or partnership firm to body corporate) designed to carry passengers on abated value to any person who is not engaged in the similar line of business	Nil	100%	0.00%	4.944%	0.00%	5.60%
	(b) in respect of services provided or agreed to be provided by way of renting of a motor vehicle (by individual, HUF or partnership firm to body corporate) designed to carry passengers on non abated value to any person who is not engaged in the similar line of business	50%	50%	6.18%	6.18%	7.00%	7.00%
8	In respect of services provided or agreed to be provided by way of supply of manpower for any purpose or security services (by individual,HUF or partnership firm to body corporate)	Nil	100%	0.00%	12.36%	0.00%	14.00%
9	In respect of services provided or agreed to be provided in service portion in execution of works contract (by individual,HUF or partnership firm to body corporate)	50%	50%
	original works			2.472%	2.472%	2.80%	2.80%
	maintenance or repair or reconditioning or restoration or servicing			4.326%	4.326%	4.90%	4.90%
10*	In respect of any taxable services provided or agreed to be provided by any person who is located in a nontaxable territory and received by any person located in the taxable territory	Nil	100%	0.00%	12.36%	0.00%	14%
11	In respect of any service provided or agreed to be provided by a person involving an aggregator in any manner	Nil	100%	0.00%	12.36%	0.00%	14.00%

* In Sl No. 6 & 10 indicates that the rates are subject to the type of service provided.

Shyam Makwana
Service Tax Practitioner
M - 09033822400