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Service tax on transport

kotha sai (ca) (40 Points)

03 June 2016

Hi,

We have the Partnershipfirm in hyderabad and having branch in odisha and purchases Goods from Andhrapradesh and transports to Odisha State and pays Freight charges and what are the points to be noted while paying Freight amount to the Transporter.

Is there any declarations to be taken from the transporter??

Whether TDS is applicable to be deducted>

Reverse charge is applicable or not??.

please clarify me in this regard.

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1 Replies

Vikas (CA) (1135 Points)
Replied 03 June 2016

You need to pay Service tax under Reverse charge mechanism @ 14% (+SBC+KKC) on 30% of the value charged by such Goods Transport Agencies (GTA).

If you are merely a trader, then the said credit would not be available to you. Otherwise, you may claim the credit subject to other conditions.

You need to obtain an invoice and a consignment note from such GTA.

I also believe that the same is liable to TDS under Section 194C of the Income Tax Act, 1961. But just check as this forum is for Service tax and not for Income tax.