Cab operator

This query is : Resolved

Aparup sinha (Querist)
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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)
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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)
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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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