Reverse charge on manpower

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 August 2015 We take service of manpower service provider and paid the ST to Government as reverse charge. we also collect the service charges on service provided by us from our customer. can we set off the ST paid as reverse charge from the ST collected.

CA AnKiT BoHrA (AB)

CA AnKiT BoHrA (AB) (Expert)
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07 August 2015 yes credit of ST paid as reverse charge is allowed........

Querist : Anonymous

Querist : Anonymous (Querist)

07 August 2015 The credit of ST paid as reverse Charge can be carry forward to next year

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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22 July 2025 Exactly! Here’s a quick summary for your reverse charge on manpower services question:

When you receive manpower supply services and pay service tax under Reverse Charge Mechanism (RCM), you are the service recipient liable to pay tax to the government.

When you provide services to your customers and charge service tax, you are the service provider and collect tax.

Can you set off (use input credit) of service tax paid under RCM against the service tax collected on your outward supplies?

Yes, absolutely!
The service tax paid under reverse charge on manpower services is eligible as input service credit.

You can utilize this credit to pay service tax on your outward supplies.

If you have excess credit (tax paid under RCM more than tax collected), you can carry forward the balance credit to next periods as per service tax rules.

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