St input on gta
This query is : Resolved
06 November 2014
Hi all,
If abatement of 25% is claimed on GTA services then we can't take Input credit. Is it correct, Please clarify.
If abatement of 25% is claimed on GTA services then we can't take Input credit. Is it correct, Please clarify.
06 November 2014
Now the general rule is that, the cenvat credit is not available when we are providing services availing the benefit of abatement. But this is applicable only on service provider and not on service recipient. Therefore, the cenvat credit of GTA service is available to a service recipient even though the service tax under reverse charge has been paid after claiming abatement of 75%.
07 November 2014
But, In abatement notification they didn't mentioned it will not applicable for RCM. Please clarify
08 November 2014
11.1 A manufacturing company is paying freight on transportation of raw materials upto its factory. Can it avail abatement and cenvat credit simultaneously?
Yes, any service receiver can avail abatement and pay tax @ 3.09% and still take cenvat credit of such tax, if the GTA service is otherwise eligible as ‘input service’. In case of outward freight, cenvat credit is not available for freight paid beyond the ‘place of removal’. The above condition in Para 10.3 restricting the cenvat credit is for the service provider using any inputs, capital goods or input services for providing such services.
- See more at: https://taxguru.in/service-tax/service-tax-goods-transport-agency-gta-guide.html#sthash.2lFI0xQr.dpuf
Yes, any service receiver can avail abatement and pay tax @ 3.09% and still take cenvat credit of such tax, if the GTA service is otherwise eligible as ‘input service’. In case of outward freight, cenvat credit is not available for freight paid beyond the ‘place of removal’. The above condition in Para 10.3 restricting the cenvat credit is for the service provider using any inputs, capital goods or input services for providing such services.
- See more at: https://taxguru.in/service-tax/service-tax-goods-transport-agency-gta-guide.html#sthash.2lFI0xQr.dpuf
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