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RCM on car repair bill

rocky (accountant) (947 Points)

23 May 2017

we are a private limited... received a bill from car workshop.
spare parts sale 1000
vat 145
washing (labour) charges 500
servive tax 75

is rcm applicable

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8 Replies

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 23 May 2017

Yes, its applicable. 50% of service tax

Ashok J (CA Final) (880 Points)
Replied 23 May 2017

@ zafar. I didn't get y rcm is applicable in this case. pls explain and also let me know the notification no which says so

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 23 May 2017

Well if its part of one agreement like that of annual service then its work contract as per service tax.
Partial reverse charge is applicable on works contract.

sachin tyagi (Artical) (36 Points)
Replied 24 May 2017

Reverse charge is not apply and amount of service tax should be paid fully rs. 75.

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 24 May 2017

Why it would be 40%?

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 24 May 2017

40/60 is for original works and 70/30 is for repair works.
This is valuation of service.
Where service is already determined separately we don't have to apply any percentage

sachin tyagi (Artical) (36 Points)
Replied 24 May 2017

you are right sir.

Well if its part of one agreement like that of annual service then its work contract as per service tax. Partial reverse charge is applicable on works contract.