Reverse charge
This query is : Resolved
25 March 2013
Sir in case of reverse charge applicability in GTA's if GTA has charged service tax in his bill and service receiver has paid him amount inclusive of service tax....
then is there any liability of Service receiver to pay service tax separately to ST Deptt. under reverse charge provisions?
then is there any liability of Service receiver to pay service tax separately to ST Deptt. under reverse charge provisions?
25 March 2013
In case of GTA service receiver is liable to pay service tax to the department....ask the transporter to refund the service tax amount to you and then deposit it to department...
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25 March 2013
AND IF TRANSPORTER HAS DEPOSITED SEVICR TAX AMOUNT TO ST DEPTT. THEN?
25 March 2013
In that case there should not be any negative consequences....just retain a challan copy by asking your transporter so that in future if penal action taken by department then you could take safeguard measure.......
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25 March 2013
and in other case if GTA has not charged service tax in its bill.
and then reverse charge is applicable or not?
and if applicable whosoever are eligilble for CENVAT credit.
and then reverse charge is applicable or not?
and if applicable whosoever are eligilble for CENVAT credit.
25 March 2013
If service tax not charged even then service tax is to be deposited assuming bill amount inclusive of service tax say GTA has given you a bill of Rs.100000/- then make the payment of Rs.89000(100000*100/112.36) and balance 11000/- (100000*12.36/112.36) to service tax department..
Reverse charge is based on service provided doesnt matter he has charged or not...you are supposed to deposit it...
and CENVAT credit is available to you....
Reverse charge is based on service provided doesnt matter he has charged or not...you are supposed to deposit it...
and CENVAT credit is available to you....
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25 March 2013
and if we have paid him total 100000 and not depositing service tax then?
25 March 2013
I had already replied this query....pay attention to all the replies only then your problem will be solved
25 March 2013
i would request you to please reply to this query last time...
rest is your discertion mam.... i fully respect your feelings...
thanx alot for the help..
rest is your discertion mam.... i fully respect your feelings...
thanx alot for the help..
22 July 2025
Here's a clear summary to address your concerns about Reverse Charge Mechanism (RCM) for Goods Transport Agency (GTA) services:
1. If GTA charges service tax in the bill and you (service receiver) pay the amount including service tax:
Under RCM, the liability to pay service tax is on the service receiver (you).
Since the GTA has already charged and presumably paid service tax, you should ask the GTA to refund the service tax portion.
Then, you must deposit the service tax with the department yourself under RCM.
Keep the challan and refund proof safe for future reference in case of audit or penalty.
2. If GTA has charged and deposited service tax to department already:
There is no double taxation as the GTA has discharged the tax liability.
Keep documentary evidence (challan, receipt) from GTA to safeguard yourself.
This can help in case department questions tax payment under RCM.
3. If GTA has not charged service tax in the bill:
You, as service receiver, are liable to pay service tax under RCM irrespective of whether GTA charged it or not.
Calculate tax on the gross amount:
For example, if the bill amount is ₹100,000 (inclusive of tax), compute taxable value and pay service tax accordingly to the department.
You can claim CENVAT credit on service tax paid under RCM, subject to usual credit rules.
4. If you have paid total ₹100,000 (including service tax) to GTA and not deposited service tax under RCM:
This is non-compliance.
You must deposit service tax with interest and possibly penalties as per law.
Ensure to maintain records of such payments and tax deposits.
Final recommendation:
Always verify whether GTA has charged service tax.
Ensure tax compliance under RCM by depositing tax yourself if GTA hasn’t paid.
Keep clear records (bills, challans, correspondences) for audit trails.
Discuss these points with your tax consultant/accountant for smooth compliance.
1. If GTA charges service tax in the bill and you (service receiver) pay the amount including service tax:
Under RCM, the liability to pay service tax is on the service receiver (you).
Since the GTA has already charged and presumably paid service tax, you should ask the GTA to refund the service tax portion.
Then, you must deposit the service tax with the department yourself under RCM.
Keep the challan and refund proof safe for future reference in case of audit or penalty.
2. If GTA has charged and deposited service tax to department already:
There is no double taxation as the GTA has discharged the tax liability.
Keep documentary evidence (challan, receipt) from GTA to safeguard yourself.
This can help in case department questions tax payment under RCM.
3. If GTA has not charged service tax in the bill:
You, as service receiver, are liable to pay service tax under RCM irrespective of whether GTA charged it or not.
Calculate tax on the gross amount:
For example, if the bill amount is ₹100,000 (inclusive of tax), compute taxable value and pay service tax accordingly to the department.
You can claim CENVAT credit on service tax paid under RCM, subject to usual credit rules.
4. If you have paid total ₹100,000 (including service tax) to GTA and not deposited service tax under RCM:
This is non-compliance.
You must deposit service tax with interest and possibly penalties as per law.
Ensure to maintain records of such payments and tax deposits.
Final recommendation:
Always verify whether GTA has charged service tax.
Ensure tax compliance under RCM by depositing tax yourself if GTA hasn’t paid.
Keep clear records (bills, challans, correspondences) for audit trails.
Discuss these points with your tax consultant/accountant for smooth compliance.
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