A country-specific update is available for the new India service tax reverse charge mechanism in Microsoft Dynamics AX 2012 R2 with the India localization layer installed

The Union Budget proposes multiple changes in Service Tax according to Negative List of Services in India. An important aspect of burden of tax liability under the Reverse Charge concept is also proposed to be replaced from existing provisions. The new India reverse charge mechanism is also applicable for the following respects:

• Rent - a - cab service
• Workforce power supply service
• Works contract service

According to the new reverse charge mechanism, the recipient of the service is made liable to pay service tax partly or fully.

Currently, Microsoft Dynamics AX 2012 R2 already supports Goods Transport Agency (GTA) scenarios in which service recipient pays all the service tax to authority. This is the 100 percent reverse charge. After you apply this update, situations in which both service recipient and provider have to pay service tax are addressed.

Hotfix information

A supported hotfix is available from Microsoft. There is a "Hotfix download available" section at the top of this Knowledge Base article. If you are encountering an issue downloading, installing this hotfix, or have other technical support questions, contact your partner or, if enrolled in a support plan directly with Microsoft, you can contact technical support for Microsoft Dynamics and create a new support request. To do this, visit the following Microsoft website:

https://mbs.microsoft.com/support/newstart.aspx

You can also contact technical support for Microsoft Dynamics by phone using these links for country specific phone numbers. To do this, visit one of the following Microsoft websites:

Partners

https://mbs.microsoft.com/partnersource/support/

Customers

https://mbs.microsoft.com/customersource/support/information/SupportInformation/global_support_contacts_eng.htm

In special cases, charges that are ordinarily incurred for support calls may be canceled if a Technical Support Professional for Microsoft Dynamics and related products determines that a specific update will resolve your problem. The usual support costs will apply to any additional support questions and issues that do not qualify for the specific update in question.