Regarding service tax on manpower supply
This query is : Open
Shashi Bhushan
(Querist)
24 November 2016
Dear All respected;
A service tax bill generate from D kumar (manpower supplier) to s pvt ltd, and he charges bill as follows,
Total man 100x30 = 3000
service charge = 500
Service tax on 3500/-@14% = 490
Total Bill amount = 3990
Please suggest me on which amount service tax should be charged. what a liable to pay s pvt ltd paid final bill e.i 3990 or service tax charged should be on service charges on Rs 500.
A service tax bill generate from D kumar (manpower supplier) to s pvt ltd, and he charges bill as follows,
Total man 100x30 = 3000
service charge = 500
Service tax on 3500/-@14% = 490
Total Bill amount = 3990
Please suggest me on which amount service tax should be charged. what a liable to pay s pvt ltd paid final bill e.i 3990 or service tax charged should be on service charges on Rs 500.
CA. Vinodh Kothari
(Expert)
24 November 2016
Supply of man power is chargeable under reverse charge mechanism (RCM) where the company receiving the service will pay service tax on RCM @ 14% +0.5%+0.5%. Since the provider of service is an individual he need not charge Service Tax on the invoice raised for supply of man power.
Shyam Lal Naik
(Expert)
24 November 2016
Service tax shall be on the gross amount and not be not merely on the service charge shown on the bill
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