Cab operator

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This query is : Resolved

Aparup sinha (Querist)

07 August 2013 We are a company availing cab facility on hire basis. Cab operator charging service tax @ 4.8% + cess.
Please advice How much we should pay as per reverse mechanism (incase bill value is Rs.10000/-) Or we need not pay anything.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)

07 August 2013 you dont need to pay seperately the cab operator will charge service tax to you as he provides service to you.

Ganeshbabu K

Ganeshbabu K (Expert)

07 August 2013 Reverse charge applicability on Hiring of motor car:-

1)As you said you are a company reversecharge will be applicable to you..if service provider is Individual, HUF, proprietary or partnership firm, AOP located in taxable territory.

2)Tax on 40% of value by service receiver and Nil by service provider.

3)If the service provider intends to avail Cenvat credit, he can pay service tax on balance 60%. Thus, service receiver is liable to pay service tax only on 40% value.

So as per my opinion you don't need to pay any ST to service provider if reversecharge mechanism applicable to you

Thanks & regards
Ganesh babu k

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