service tax resposibility

This query is : Resolved

lalit sharma (Querist)
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21 May 2017 sir/madam. we are receiver of services of goods trandport and in their service tax bill , they charged service tax @15%. now i want to know our respodibility related to service tax as a service receiver.

CA Mohit Kumar

CA Mohit Kumar (Expert)
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21 May 2017 Read GTA reverse charge rule

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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25 July 2025 Hey! Here’s a clear explanation about your **Service Tax responsibility as a service receiver of Goods Transport Services (GTA):**

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### 1. **Who pays Service Tax on Goods Transport Services?**

* For **Goods Transport Agency (GTA) services**, the Service Tax law says the **service receiver is liable to pay Service Tax under Reverse Charge Mechanism (RCM)** in certain cases.

* However, this applies **only if the service receiver is a “specified person”** (like a company, firm, body corporate, etc.).

* If the receiver is an **individual or HUF (Hindu Undivided Family)**, **RCM is generally not applicable** for GTA services.

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### 2. **What about the 15% Service Tax charged by the transporter?**

* The **current service tax rate for GTA services is 5% (plus applicable cess)**, **not 15%**.

* If the transporter has charged **15% service tax**, it is likely including other services or it might be an error.

* Also, **if the transporter charges service tax under normal charge, you (service receiver) don’t pay again under RCM**.

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### 3. **Your responsibility as a service receiver**

* If your business is a **specified person**, you must:

* Pay Service Tax on GTA service under Reverse Charge, directly to the government (if transporter did NOT charge Service Tax).

* Obtain Service Tax Registration if you don’t have one.

* File Service Tax returns declaring the tax paid under RCM.

* If the transporter has already charged you Service Tax on their invoice (i.e., charged you 5% service tax properly), then:

* You **do not pay tax again under RCM** on that service.

* You **cannot claim Input Credit on such tax paid under RCM**, since GTA service under RCM does not allow credit.

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### 4. **In brief:**

| Scenario | Your Responsibility |
| ------------------------------------- | ----------------------------------------- |
| Transporter charges 5% ST properly | Pay transporter, no RCM tax to pay by you |
| Transporter does NOT charge ST | Pay ST under RCM directly |
| Transporter charges 15% ST (unlikely) | Verify details & clarify charges |

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If you want, I can help you check if your business is liable under RCM and guide you on registration and payment procedures. Would you like that?

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