Rcm in work contract

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Pankajsarkar (Querist)
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14 August 2015 Dear Sir/madam

One party billed to us Rs. 200000.00 against the labour charges of painting work. In that invoice service tax registration no is not mentioned i.e service provider is unregistered. What will be tax liability to us i.e service receiver.

1. It is under RCM and 50-50 ratio.
2. Whether we need to pay service provider part to him (Rs. 200000.00*14%/50%)Rs.14000.00. Total payment to service receiver Rs. 214000.00 and Rs. 14000.00 to pay to Govt.

Or.
Only Rs. 200000.00 to pay to the service provider and only Rs. 14000.00 (Receiver`s share) to pay to Govt.

or.
Only Rs. 200000.00 to pay to service provider and Rs. 28000.00 (Total share) paid to Govt.

Please reply.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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14 August 2015 Pay only Rs. 2,00,000 to service provider and pay Rs. 14,000 to Govt under RCM.

Pankajsarkar

Pankajsarkar (Querist)
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14 August 2015 Thank you very much sir ji

Pankajsarkar

Pankajsarkar (Querist)
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17 August 2015 Dear Sir

if the above invoice is for painting (Labour) of Hatchery building what will be the service tax???

Please reply

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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20 July 2025 The applicable service tax is 14% (works contract labor)

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