Aplicability
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
19 December 2013
A contractor providing labour in the factory ,so the contractor will charge service tax ?
if it is yes ..but the contractor is not charging the service tax than what the company should do.
A contractor providing labour in the factory ,so the contractor will charge service tax ?
if it is yes ..but the contractor is not charging the service tax than what the company should do.
CA Vikas Acharya
(Expert)
19 December 2013
YES, he should charge the same if he is liable under service tax, i.e, if his total services crosses 10 lacs in a financial year.
COMPANIE'S LAIBILTIY:
the service is manpower supply service.
for this if the contractor is not a co./body corporate meaning thereby is that the provider is individual, huf, partnership etc.. then the receiver co. (if body corporate) has to pay 75% of the tax.
so on total labor charges pay 9.27% i.e, 75% of 12.36%.
the above is due to application of reverse charge rule.
if the co. pays this, it is paying its liability & can claim the same as cenvat credit if on the basis of challan if providing any output service subject to ccr rules
COMPANIE'S LAIBILTIY:
the service is manpower supply service.
for this if the contractor is not a co./body corporate meaning thereby is that the provider is individual, huf, partnership etc.. then the receiver co. (if body corporate) has to pay 75% of the tax.
so on total labor charges pay 9.27% i.e, 75% of 12.36%.
the above is due to application of reverse charge rule.
if the co. pays this, it is paying its liability & can claim the same as cenvat credit if on the basis of challan if providing any output service subject to ccr rules
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