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Service tax on reimbursement of expenses


05 June 2012 Our company is a MNC registered as Private Limited Company under Indian Companies Act. Ours is a subsidiary of a MNC which is also registerd as Private Limited Company under Indian Companies Act.

Some of the overseas employees are deputed to our company from our parent company aftering enterin an agreement. Thier salary and other allowances (viz., vehicle petrol, driver salary, medical expenses, food expenses etc.) is paid by my parent company and TDS is deducted on the above on before paying the salary and the same is get it reimbursed from us.

Here now my question is as follows:

1. Is service tax is applicable on the above.
2. If so under which service the same has to be clasified.

Now my question is for the salary recovered from us did we have to pay service tax charged by my parent company while raising invoice on us.

05 June 2012 Deputation would normally get covered under either under business support services or consultancy services depending upon the nature of function performed by deputed personnel.


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