Applicability of service tax
This query is : Resolved
20 March 2015
respected sir,
we provide service regarding supply of manpower to entity in Gurgaon. in this we pay eg-Rs. 100000 to security guard and in this respect collect 8% service charge on Rs. 100000 say Rs.8000/- and charge service tax on Rs. 1,08,000/- and receiving amount of Rs. 1,05,840/- after deducting TDS 2%
my question is if we provide 2 bill say one is reimbursement of expenses and another bill say rs. 8000 upon which we charge service tax. so suggest me that this type of reimbursement of expenses is eligible for non attraction of service tax.
regards
Nishant Kakkar
M-9871034071
we provide service regarding supply of manpower to entity in Gurgaon. in this we pay eg-Rs. 100000 to security guard and in this respect collect 8% service charge on Rs. 100000 say Rs.8000/- and charge service tax on Rs. 1,08,000/- and receiving amount of Rs. 1,05,840/- after deducting TDS 2%
my question is if we provide 2 bill say one is reimbursement of expenses and another bill say rs. 8000 upon which we charge service tax. so suggest me that this type of reimbursement of expenses is eligible for non attraction of service tax.
regards
Nishant Kakkar
M-9871034071
21 March 2015
Dear Nishant Kakkar
Payment to security guard is as per the terms of contract or terms of employment between you and the concerned Guard/s
This cannot be treated as reimbursement of expenses. There are decided cases which has excluded certain reimbursements as non taxable. But clearly in your case it is taxable. Nevertheless the Finance Bill 2015 has amended the definition of consideration to include reimbursements of expenses and accordingly once the definition comes in to operation the decided cases will have no effect. casrinivasantry@gmail.com
Payment to security guard is as per the terms of contract or terms of employment between you and the concerned Guard/s
This cannot be treated as reimbursement of expenses. There are decided cases which has excluded certain reimbursements as non taxable. But clearly in your case it is taxable. Nevertheless the Finance Bill 2015 has amended the definition of consideration to include reimbursements of expenses and accordingly once the definition comes in to operation the decided cases will have no effect. casrinivasantry@gmail.com
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