Service tax on freight
This query is : Resolved
03 June 2013
Dear Sir,
We are paying service tax under reverse charge mechanism. Generally GTA doesnt charge service tax in their invoice. We pay to them their fee and deposits service tax @ 3.09%
We have received one invoice in which service tax is charged by GTA in their invoice.
Invoice is as follows.
Fee = Rs 1000.00
Service Tax @ 3.09% = Rs 30.90
Total = Rs. 1030.90
We have paid them Rs. 1030.90.
Do we have liability to pay service tax under reverse charge even we have paid to GTA.?
We are paying service tax under reverse charge mechanism. Generally GTA doesnt charge service tax in their invoice. We pay to them their fee and deposits service tax @ 3.09%
We have received one invoice in which service tax is charged by GTA in their invoice.
Invoice is as follows.
Fee = Rs 1000.00
Service Tax @ 3.09% = Rs 30.90
Total = Rs. 1030.90
We have paid them Rs. 1030.90.
Do we have liability to pay service tax under reverse charge even we have paid to GTA.?
03 June 2013
yes you do,even if u paid the tax to gta.
as per cbec clarification:
The liability of the service provider and service recipient are different and independent of each other.
Hence you are liable for your liability.
Though if you make a contract regarding the tax liability payable by GTA, then you can avoid ur liability refer the following case:
https://www.caclubindia.com/experts/shifting-of-service-tax-liability--1324329.asp
as per cbec clarification:
The liability of the service provider and service recipient are different and independent of each other.
Hence you are liable for your liability.
Though if you make a contract regarding the tax liability payable by GTA, then you can avoid ur liability refer the following case:
https://www.caclubindia.com/experts/shifting-of-service-tax-liability--1324329.asp
03 June 2013
Thanks for your reply Sir.
So can we enter into agreement with our GTA that our service tax liability will be borne by GTA.? then we need not to pay service tax under reverse charge?
So can we enter into agreement with our GTA that our service tax liability will be borne by GTA.? then we need not to pay service tax under reverse charge?
03 June 2013
yes, do it for this case.
though in my opinion with other GTAs and also for future transactions have a pre-contract that gta will not charge service tax and even if charged you will directly deposit it to the govt.
as the same will be more suitable option, otherwise may lead to penalty as matters in litigation remains in litigation..
though in my opinion with other GTAs and also for future transactions have a pre-contract that gta will not charge service tax and even if charged you will directly deposit it to the govt.
as the same will be more suitable option, otherwise may lead to penalty as matters in litigation remains in litigation..
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