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April 2016

Changes in Reverse Charge Mechanism

By Tarun Ghia, Pratik Mehta, Brijesh Cholera Chartered Accountants
Reading Time 1 mins
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Notification No. 18/2016 dated 01. 03. 2016

This Notification has proposed changes in Reverse Charge Mechanism by amending Notification No. 30/2012-ST dated 20.06.2012 which will be effective from 01.04.2016 :

1. In Paragraph I, in clause (A), sub-clause (ib) is omitted to provide that services provided by mutual fund agents/ distributors to a mutual fund or asset management company are being put under forward charge;

2. In Paragraph I, in clause (A), sub-clause (ic) is substituted by “provided or agreed to be provided by a selling or marketing agent of lottery tickets in relation to a lottery in any manner to a lottery distributor or selling agent of the State Government under the provisions of the Lottery (Regulations) Act,1998 (17 of 1998)”, to bring in line with changes made in section 65B(44) of the Finance Act;

3. In Paragraph I, in clause (A), sub-clause (iv), item (B) has been substituted to provide that legal services provided by a senior advocate shall be on forward charge.

4. The words “support services” have been omitted from Serial No.6 making any service provided by Government taxable .

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